UK consumer spending shows “resilience” in July

British consumer spending showed “resilience” in July, according to the latest survey from Visa Europe compiled by Markit.

July spending was up 1.6 percent year-on-year, an improvement over June’s 0.9 percent increase and May’s 0.8 percent rise, and marking the biggest rise in three months. However, the spending increase is still lower than the average growth rate in the past two years of 2.4 percent.

Of all eight monitored broad sectors, Hotels, Restaurants and Bars saw the steepest rise in spending, 8.9 percent increase, following by Recreation and Culture (5.2 percent), and Food, Beverages and Tobacco (5.1 percent).

While the clothing and footwear sectors also saw solid increases in spending with a rise of 3.9 percent. Notably, it was only the second time in the past five months spending that clothing and footwear categories have increased.

"July's data suggests that UK consumer spending is holding up despite the ongoing uncertainty following the referendum, albeit at lower levels of growth than we've seen in the last couple of years," said Kevin Jenkins, Visa's managing director for Britain and Ireland.

Jenkins added: “Looking at the sectors, the longer term trend we’ve seen for increased spending on leisure and recreation is enduring. And the high street saw its strongest annual growth rate in five months with clothing retailers in particular bouncing back after a fall in June.”