April showers kept shoppers home

Spring may have sprung, but the wettest April on record kept shoppers home and made for an 11 per cent drop in sales. Sales of clothing and footwear was down -8.1%, with spending down across all channels compared to a year ago, led by -6.9%

decline on high street. Online expenditure only slightly lower (-0.8%).

Commenting on the latest results, Dr Steve Perry, Commercial Director at Visa Europe said:“April saw a surprisingly large drop in consumer spending according to the UK Expenditure Index. The dismal weather clearly had an impact on retail sales and unlike last year there was no Royal Wedding to buoy the month’s consumer expenditure. Online spending declined less markedly than on the high street in April indicating that shoppers were in no mood to brave the weather."

“Spending in March was artificially inflated by fuel panic buying which masked an underlying trend of weak consumer confidence. Spending in April was 1.9% lower than in March. On a rolling three month basis, the Index highlights a deteriorating picture for consumer confidence with spending down 0.6% compared to 0.4% last month. The Index data reflects the fact the UK economy has entered a technical recession.”

Chris Williamson, Chief Economist at Markit said: “Spending in April showed one of the largest monthly falls seen since the height of the financial crisis in early 2009. Some pay- back from higher spending on petrol was to be expected following the panic-buying in March, as was a drop in expenditure on new season clothing and items such as garden furniture due to the warm weather seen in March, which caused many people to pull forward these purchases earlier in the year than usual. However, the underlying trend in the spending data clearly remain weak, and will raise concerns that the economy has started the second quarter on a worse footing than the first quarter. Consumer spending remains under pressure from a considerable list of headwinds, including high unemployment, widespread job insecurity, low pay growth, high inflation and high debt. As such, it would be surprising to see any pick-up soon.”

The Visa Europe Expenditure Index provides a uniquely comprehensive and timely insight into the health of consumer spending in the UK. Tracking actual spend on all Visa debit, credit and prepaid cards, this data is adjusted by Markit to allow for Visa card issuance, consumer payment preferences and inflation.