Consumer spending growth slowed to 2.8 % in May despite Brits continuing to spend on the experience economy as overall confidence in household spending power cooled in April.
Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, revealed lower levels of growth across everyday essentials (3.1%) when compared with the Easter-driven increase of 11.4% in April.
Paul Lockstone, managing director at Barclaycard, said: “Consumer spending growth was subdued last month as shoppers paused for breath after an Easter bounce in April. With CPI running at its highest rate since 2013, it’s no surprise that more of us are starting to ‘feel the squeeze’ of inflation and slower wage growth, perhaps prompting small changes to our spending patterns.
Consumers’ confidence in their ability to spend on non-essentials also dipped a further 2 percentage points in May to 4%, with a slim majority (52%) of Brits saying they are ‘feeling the squeeze’ due to a combination of inflation and subdued wage growth.
Of these, 69% say the sentiment is because their weekly shop is more expensive than it used to be, and another three in 10 (31%) say it is because of increased fuel prices – highlighting the impact of rising prices on groceries and essentials more broadly.