THE first slowdown in retail sales in more than a year could reduce the likelihood of further interest rate rises, analysts predicted last night.

Retail sales have slowed for the first time in more than a year after poor weather hit sales of clothing last month, figures showed.

The Office for National Statistics (ONS) said sales volumes fell 0.4 per cent between June and last month - slightly worse than City expectations, although experts said there was still evidence of buoyancy in the high street.

That is because the ONS said sales were 6.6 per cent ahead of a year ago, while the figure for the three months was 1.8 per cent higher than the previous quarter.

But Andrij Halushka, economist at the Centre for Economics and Business Research, said the figures represented a tentative sign that consumers have started to react to interest rate rises.

He said: "This data may calm the markets, indicating that the UK consumer boom may be finally over and the Bank of England will not have to continue raising interest rates aggressively."

The fall in sales volumes was the first since May last year and follows a number of interest rate rises aimed at cooling consumer spending.

Household goods stores and other non-food outlets showed the strongest growth last month.

In contrast, clothing stores saw a 2.7 per cent fall in sales volumes, compared with a decline of 0.7 per cent in June, as wet weather kept shorts and other summer items on the shelves.

The total value of sales last month was estimated at £18.7bn, 5.3 per cent higher than the same month last year.