Hotel, restaurant and bar spending a rare bright spot in a tough September

Spending growth in hotels, restaurants and bars held up in September 2017 during what was otherwise a fairly dismal month for consumer spending.

The hospitality sector enjoyed a 3.5% rise in spending on a year ago, providing one of the few bright spots in the economy as a whole.

Overall household expenditure declined by 0.3% on the previous year, making it the fourth month in the past five to see a fall, according to the latest figures from Visa UK.

There was a 6.4% drop in spending on transport and communication and a 2.6% fall in household goods while most other categories were in negative territory aside from food, beverages and tobacco, as well as miscellaneous goods and services.

The figures suggest that spending in hospitality is being propped up by strong overseas visitor numbers, as well as UK consumers' continued readiness to sacrifice spending in other areas in order to continue to be able to eat and drink out.

Kevin Jenkins, UK & Ireland managing director at Visa, said: "Despite a slight uptick in UK consumer spending in August, the story of the past few months has been one of wariness in household spending. September saw another decline in overall expenditure, continuing the recent trend of belt tightening, as the landscape of financial uncertainty takes its toll.

"The recreation and culture sector declined at its fastest rate since July 2013, bucking a trend in which the "experience economy" has remained buoyant in the face of stagnant wage growth and increased inflation. Despite this, there is a bright spot in this month's data as hotels and restaurants saw an increase in spending of 3.5%.

"The trend of spending shifting to online retailers shows no sign of abating with e-commerce continuing to show resilience. In contrast, the suffering of the British high street shows no signs of slowing, as evidenced by another fall in Face-to-Face spending."

Restaurant bosses' confidence in market slips but they remain upbeat about own prospects >>

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