The Olympic Games dented retail sales in August in the UK, according to the British Retail Consortium (BRC).
Retail sales fell by 0.4 per cent on a like-for-like basis last month to record the second worst month since November 2011. Only April this year saw a lower level of activity n the high street.
Sales grew by 1.6 per cent year-on-year, compared to growth of 1.5 per cent seen in August 2011.
Analysts had been hoping for a boost in sales as result of the London Olympics but that failed to happen, raising concerns that a similar positive injection to GDP in the third quarter will not occur.
The data shows that the Olympics gave a minor boost to food and drink sales but the feelgood factor from the spectacular performance of British athletes at the Olympics failed to persuade consumers to spend.
However, many people stayed away from the shops as they enjoyed watching the massive sporting occasion.
Howard Archer, Chief UK & European Economist at IHS Global Insight said: “The BRC survey dilutes hopes that the holding of the Olympic Games has had a significant overall boost to the UK economy in the third quarter (although there will be a positive impact from the ticket sales) and it also underlines the fact that consumers are still facing very difficult times.”
London saw a reduction in footfall across the retail sector as consumers stayed away from London put off by the authorities who discouraged people from coming into the capital. The trend was not replicated in other cities which did not suffer from reduced numbers, but the net effect of the games was “minimal”, according to the BRC.
Stephen Robertson, director general of the BRC, said: "There's no evidence here of any Olympic boost to retail sales overall. Sadly, apart from April - distorted by Easter timings - August saw the worst sales growth this year.
"Hot weather and the Olympics did help sales of party food and drink but that was more than offset by a really weak performance for non-food goods.
"It's clear people were absorbed by the magnificent Olympics and had little interest in shopping, especially for major items."
The rise of online sales stalled in August, with just a 4.8 per cent rise, the lowest since the BRC started collecting data on internet sales in October 2008.
Sales of womenswear dropped as shoppers were not tempted to buy for the autumn and winter seasons.
Mr Robertson added: "As summer gives way to the all-important Christmas run-up, retailers will be hoping sales that didn't happen in August have been postponed and not lost entirely."
Meanwhile, figures from the Local Data Company (LDC), showed that the number of vacant shops increased in every region in the UK except for London in the first six months of 2012, taking the overall average of empty shops to 14.6 per cent.