A woman walks into a Debenhams store

British retailers reported slower sales growth in June but sales remained above average for the time of year, according to an industry survey.

City analysts said the figures pointed to healthy retail sales growth of about 0.9% in the second quarter of the year, giving a boost to the economy.

The Confederation of British Industry’s (CBI) retail sales balance fell to from 51 in May, a five-month high, to 29 in June as shoppers bought fewer groceries. The clothes sector and goods such as flowers, watches and jewellery were among the best performing.

Howard Archer, the chief UK and European economist at IHS Global Insight, said: “This is still a very decent survey that points to healthy consumer activity.”

Even if official figures show retail sales were flat in June, volumes would still be up 0.9% in the second quarter, he said.

Archer believes that robust consumer spending helped the economy regain momentum in the second quarter after a lacklustre start to the year. GDP grew 0.3% in the first quarter, which looks set to be revised to 0.4% on Tuesday after revisions to construction output. Archer reckons that growth then improved to 0.7% in the second quarter.

He said: “The prospects for retail sales and consumer spending look bright, especially now that earnings growth seems to be firming appreciably, thereby boosting purchasing power along with negligible inflation and increased employment.”

The CBI’s measure of expected sales for July fell to 33 after hitting a 26-year high in last month’s survey, but the three-month sales measure (31) was at the highest level since February.

Barry Williams, a senior Asda executive and the chairman of the CBI survey, said: “Summer is a time of optimism for retailers and this year is no different. Even though growth slowed slightly this month, retailers are not letting that subdue their hopes for the season.

“Low inflation – expected to stay below 1% throughout this year – has given customers more discretionary income. The power of the pound in their pocket is going further and shoppers are spending more on treats, like flowers and jewellery, as well as on activities with their families.”

Official data last week showed that retail sales growth slowed in May after strong sales in April, which had warmer weather. The cooler temperatures meant consumers bought fewer summer clothes in May.

The boss of Debenhams warned on Thursday that while customers were starting to feel better off, they remained cautious about spending because of the government’s forthcoming £12bn in welfare cuts.