RETAIL SALES declined again in the third quarter, although September recorded the lowest monthly drop so far this year, according to an industry review.

Compared to the same quarter of 2009, sales were down more than 3 per cent, the Irish Retail Industry Performance quarterly review found. September just fell shy of like-for-like parity, however, recording a decline of 0.21 per cent. In comparison with last year sales declined by 5.24 per cent in July and 3.87 per cent in August.

Retail Excellence Ireland, the retail body that compiled the research, said September’s sales figures had been boosted by summer sales and the back-to-school period.

“The bad news is that retail sales are still in decline, and like-for-like growth in 2010 will most likely be determined by the reaction of consumers to the upcoming budget,” said REI chief executive David Fitzsimons.

REI said retailers would now be looking to the valuable Hallowe’en and Christmas periods to help lift overall sales figures for the year, but the budget could impede expected growth if consumers were fearful to spend.

“Our data confirms that around the time of a budget consumers freeze their spending in the run-up to, and also after, the announcements have been made, so any expected return to growth, or even parity, in 2010 hinges on the consumer reaction to budget day in December.”

While no individual sector recorded overall growth for the quarter, the jewellery, footwear and pharmacy sectors experienced growth, although this was not sustained for more than one month in any instance.

Ladies fashion was the worst-performing retail sector in terms of sales, with a 5.42 per cent drop compared with 2009. The grocery sector also continues to struggle, falling 4.97 per cent from the same quarter in 2009.