Cash-strapped consumers across the UK are reining in on eating out and buying takeaways to save up for what many see will be an expensive festive season.
New credit card transaction data found that the amount being spent on going out to restaurants plunged 10.8% month-on-month in September, compared to a more modest 5.8% decline in August, according to the latest UK consumer card spending figures from Barclays.
Spending on takeaways also slowed, from 9.2% in August to 6.5% in September, as 44% of those surveyed said they are beginning to reduce discretionary spending in order to pay for Christmas.
Eating at restaurants is the main area where customers are reducing discretionary spending with 60% of respondents saying they were cutting back on dining out to boost their budgets ahead of the festive season.
A swing towards saving was also reflected in monthly footfall figures, which fell almost 3% in visits to the high street, retail parks and shopping centres in September, according to the latest data from the BRC.
Shopping centres and retail parks suffered falls of 4% and 2.4% respectively month-on-month.
Two-fifths of consumers believe Christmas will be more expensive this year, and a fifth are already starting to buy presents to spread the cost.
Jack Meaning, chief UK economist at Barclays, said: “Over the last few months, a picture has been building of consumers beginning to pull back on discretionary spending as the cost of living and monetary tightening from the Bank of England increasingly bite. We’ve seen the warning signs from surveys, and now we see it in the more concrete spending data.
“This suggests the outlook for consumers and the businesses that rely on them is weak even as they finally see their disposable incomes rise faster than inflation. It makes it hard to see anything but a relatively stagnant economy on the horizon.”
Despite the slowdown, overall consumer card spending grew 4.2% in September, less than the 6.3% rate of inflation, as the cost of goods continues to climb.
No comments yet