Barclays Bank has reported a decrease in card spending for the first time in over three years, according to their latest data. This marks the first decline in card spending values since February 2021.
The bank’s June data, which covers nearly 40% of the nation’s credit and debit card transactions and combines it with consumer research, shows a decrease in spending due to a combination of factors. The recent weakening of inflation has led to lower prices, while wet weather has dampened sales in areas such as clothing, pubs, and garden centers early in the month.
The decline in card spending was also seen in supermarket transactions, which experienced a decrease for the first time since June 2022, two years ago. Barclays attributes this to consumer cutbacks and a sharp drop in food inflation. In fact, a majority of shoppers (65%) have reported cutting their weekly grocery spending, with over half actively seeking discounts through loyalty programs and other deals.
The recent weather conditions have also affected consumer spending, with two in five Britons reporting spending less than usual on summer products, with clothing being the most commonly reduced category. However, there has been growth in the entertainment sector, with cinemas experiencing their busiest day of the year on June 15th, following the release of Disney Pixar’s Inside Out 2. Additionally, more money was spent on takeaways and streaming services, likely due to the release of new seasons of popular shows like Bridgerton and House Of The Dragon.
The Euros football tournament has also had a positive impact on spending, particularly in pubs, bars, and clubs. However, restaurant spending has decreased, reflecting people’s selective and cost-conscious approach.
While international holiday spending has seen growth, domestic hotel and resort bookings have dropped. However, there are signs of economic hope as 73% of people reported feeling more optimistic about their ability to live within their means.
In other news, a hotel chain has agreed to remove a claim about early purchases, according to recent reports. Additionally, Metro Bank has announced a revival of their £3 billion mortgage sale.
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