Overall consumer spending falls 2%

Overall consumer spending falls 2%

Overall consumer spending fell 2% in April year-on-year in the UK, according to the latest Visa UK Consumer Spending Index, meaning that 11 of the past 12 months have seen a decline.

While hotels, restaurants and bars saw an increased spend of 2.9% last month compared to 2017, food, beverages and tobacco decreased 4.6%, household goods fell 6.1%, and clothing and footwear reduced 3.5%.

That said, the spending rise in hotels, restaurants and bars was at its softest pace since August 2017.

The data also showed how people are spending, with face-to-face spending declining 5.4% (2.9% in March) compared to 0.1% for eCommerce (1.1% in March).

“With inflation beginning to fall and wages growing faster than expected in recent months, it would have been easy to assume we might be over the worst of the consumer squeeze,” says Visa chief commercial officer Mark Antipof. “Yet there has been no corresponding improvement in spending, with April’s 2% decline a simple repeat of what we witnessed in March.

“Low confidence levels among shoppers and the gloomy outlook for the UK economy are likely to have contributed to this continued caution. It is clear that consumers remain in belt-tightening mode, with discretionary spending on furniture, electrical appliances and recreational activities worst hit.

“Retailers will be pinning their hopes on further improvements in household finances and warmer weather leading to a more upbeat few months heading into summer.”