Pubs see increased spending in Sept as restaurants struggle
Overall, consumer card spending grew 4.2% year-on-year in September, less than the latest CPIH inflation rate of 6.3% but higher than August’s growth figure of 2.8%
Spending in pubs increased 6.1% in September, compared with a 2.8% increase last month driven by the Rugby World Cup, according data from Barclays.
Despite this, growth in spending slowed for spending in restaurants which was down 10.8% compared to a decrease of 5.8% last month
Furthermore spending on takeaways was only up 6.5% compared with 6.4% last month, as Brits begin to save for Christmas.
This comes as 44% of Brits said they are planning to reduce in discretionary spending over the next couple of months to save money for the upcoming festive period,
Eating out at restaurants was the most frequently cited cutback with 60% of respondents bringing it up.
Overall, consumer card spending grew 4.2% year-on-year in September, less than the latest CPIH inflation rate of 6.3% but higher than August’s growth figure of 2.8%.
Esme Harwood, director at Barclays, said: “Grocery spending tapered off over the summer, thanks to the long-awaited drop in food price inflation. Worryingly, growth sped up again in September, which could be an early warning sign that food prices may not come down as quickly as we’d hoped.
“Eagle-eyed shoppers have spotted more examples of “surge pricing” and “shrinkflation”, and are becoming sceptical about the value of supermarket loyalty schemes. Consumers are also starting to pull back their spending in some non-essential areas, so that they can put more money aside for the festive season.”
Jack Meaning, chief UK economist at Barclays, added: “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.”