There was a drop in consumer spending on credit and debit cards last month, for the first time in more than three years.
Data from Barclays shows that card spending fell by 0.6% year-on-year in June — the first decline since February 2021 — as colder weather early in the month reduced spending at clothing stores, pubs and garden centres.
Supermarket card spending also declined for the first time in two years, due to prices rising less than before and shoppers continuing to watch their spending. Two thirds of consumers (65%) say they are cutting back on their weekly grocery expenditure, with over half (52%) of these budget-conscious shoppers looking out for loyalty scheme discounts and supermarket deals.
However, the bank said that the combination of cooler temperatures and new TV series such as ‘Bridgerton’ and ‘House of the Dragon’ boosted digital content and takeaways, while ‘Inside Out 2’ provided a big boost to cinemas on the weekend of its release.
Pubs, bars and clubs saw overall growth of 0.5% year-on-year in June as the influx of football fans watching the Euros outweighed the bad weather, but people are still spending less on eating out at restaurants, with restaurant spending down 11.5% year-on-year after a 15.7% drop in May.
The figures cover nearly 40% of credit and debit card transactions in the UK.
“While June’s data suggests a weak month, the view looking ahead to the second half of the year, as we see it, is one of falling interest rates, growing real incomes, and increasing confidence among consumers to spend and businesses to invest, particularly now that the uncertainty of the general election is out of the way,” said Jack Meaning, chief UK economist at Barclays.
