Ibec’s quarterly Retail Monitor survey has revealed a “concerning lack of real growth” in the sector in the first three months of the year, according to the Retail Ireland division of the employers’ lobby group.

The report says “retail’s slow growth lags behind [the] general recovery”, with sales just 0.9 per cent ahead of the same period last year, when measured by value.

The volume of sales was up more than 5 per cent, however, suggesting that retailers are still heavily discounting.

"The report highlights that certain categories such as furniture and homewares are outperforming the general retail sector largely as a result of the release of pent-up demand, while others including supermarkets, books, news and stationery continue to struggle," said Tom Burke, Retail Ireland director.

Deflation and severe competition between grocers slowed growth in the supermarket sector, the report showed. Department stores recorded a fall of 4.4 per cent, while forecourts recorded a fall of 8.1 per cent.

“Value for money is still the key determinant,” said Mr Burke, who said the weak euro had brought pressure on retailers.

“Retailers are [also] very concerned about proposed increases in other costs, specifically wage increases. With recovery in retail still fragile, Retail Ireland warns that any increased costs could further destabilise a sector which has endured a torrid last six years.”