Consumer spending up 3.4%

Consumer spending up 3.4%

The latest data from Barclaycard shows that overall consumer spending rose 3.4% year-on-year in April.

While essential spending slowed to a 21-month low of 1.8%, spend on entertainment was up 7.1%, with restaurants seeing a 7.2% increase and pubs 7.6%, despite mixed weather in April.

The slight growth in spending appears to match overall consumer sentiment, which sees 62% of Brits feeling confident in their household finances.

The threat of an interest rate rise is a concern, with 35% saying they would have to cut back on spending each month should it happen. Over 40% said they would rein-in on nights out, suggesting that the experience economy, which has continued to perform strongly, is not completely safe.

“While spending has recovered slightly from the effects of the ‘Beast from the East’, it’s likely we’ve seen some missing expenditure from March carry over to April as the weather finally allowed shoppers to venture back outside,” says Barclaycard managing director Paul Lockstone.

“Consumers prioritised spending on the ‘nice-to-haves’ last month, but there’s no indication that they are looking to loosen the purse strings quite yet. Instead, the UK seems to be caught in a holding pattern, with people still budgeting carefully. Looking ahead, uncertainty around interest rates is weighing on the minds of many, with people prepared to cut back on non-essentials in order to cope with a rate rise.”