Consumer card spending growth flatlined in March

Non-essential spending growth hit an 18-month low in March in the UK, as a new report from Barclays shows that consumer card spending growth flatlined, on par with February’s modest 1.9 percent uplift and significantly less than the latest CPIH inflation rate of 3.8 percent.

This was due to a slowdown in non-essential spending, which saw its smallest increase (1.6 percent) since September 2022, as wet weather dampened retail and restaurant sales.

The report adds that retail spending growth was almost flat at 0.7 percent, while face-to-face retail (excluding groceries) and clothing saw declines of -2.1 percent and -1.8 percent respectively, as spring showers deterred shoppers from visiting the high street.

This comes as 45 percent of consumers say they are continuing to rein in discretionary spending, with the majority (53 percent) cutting back on clothing and accessory purchases and nearly half (47 percent) spending less on dining out.

Karen Johnson, head of retail at Barclays, said in a statement: “Retailers were braced for a more subdued start to 2024, and recent figures are in line with expectations. The wet weather has been a key factor in the slowdown in discretionary spending, as it’s meant fewer visits to the high street and to hospitality venues.

“However, in spite of this initial lull, many retailers are confident that spending will rebound in the coming months, particularly in anticipation of better weather, the energy price cap drop, an uplift in the National Minimum Wage, and the buzz around major events such as Taylor Swift’s Eras Tour and the Paris 2024 Olympics.”