Retail sales fell in August as weak consumer spending continued to drag on the economy.

The latest figures from the Central Statistics Office showed sales declined 3.6 per cent in the year to the end of August 2011, and were 0.4 per cent lower compared with July.

Excluding the motor trade saw the annual decline deepen to 3.7 per cent, and the monthly decrease was 0.5 per cent.

Only one category showed a year-on-year gain, with the volume of sales of electrical goods rising 2.1 per cent compared with the same month in 2010.

Other categories fared worse. Books, newspapers and stationery saw sales decline by 13.3 per cent compared to a year earlier, while pharmaceuticals medical and cosmetic articles were 10.4 per cent lower.

Furniture and lighting fell by 9.5 per cent over the year.

The value of retail sales also fell in August, declining by 3.1 per cent over the year and 0.8 per cent compared with the previous month.

Excluding the motor trades once more impacted sales, with the decline in value narrowing to 2.8 per cent on a yearly basis. However, on a monthly basis, that decrease was marginally higher at 0.9 per cent.

"The familiar drags on Irish consumer spending are not going to go away soon, including a weak labour market, fiscal consolidation and deleveraging," said Goodbody chief economist Dermot O'Leary.

The firm said it was forecasting another fall in consumer spending of 0.8 per cent this year in 2012, with a 2.3 per cent decline predicted this year.

"There is nothing in the latest data that changes our view on this front," he said. "Exports will need to continue to be the driver for Irish economic growth in the short-term."

Ibec group Retail Ireland called for Government intervention to help the sector.

"The continuing year on year decline in core retail sales is a continuation of a downward trend that has been there since 2008. The crux is the lack of consumer confidence, something that only Government can help restore," said Retail Ireland director Torlach Denihan.

"Unless and until consumers have a clear line of sight regarding their household finances and feel better about their employment prospects they will remain reluctant to spend."

The Irish Small and Medium Enterprises Association,called for the Government to introduce the Retail Strategy Group to address the concerns of the retail sector.