Hot weather ensures pub and restaurant spend bucks slowing growth

11 July 2017 by
Hot weather ensures pub and restaurant spend bucks slowing growth

June's heatwave prompted ensured pub and restaurant spend last month was up 13.6% and 11.4%, respectively, despite consumer spending growth slowing to a 15-month low of 2.5%.

That's according to data from Barclaycard, which reveals last month's slowdown dragged overall growth down to 3.5% in Q2 as the rising costs of essentials prompted consumers to row back on luxuries and come to terms with subdued wage growth and creeping inflation.

While April recorded the joint-highest figure (5.5%) since Barclaycard records began, helped by a later Easter, May (2.8%) and June (2.5%) were much more muted as cautious consumers reined in spending, with a 6% rise in supermarkets pushing up essential spending 5.9%.

Barclaycard research reveals the proportion of those confident in the UK economy is now just 33%, a seven-month low, with almost half (46%) saying they are ‘feeling the squeeze' due to rising prices and subdued wage growth, and six in 10 (60%) believe they now get less for the amount of money they spend. Confidence in household finances is holding steady at 69%, however, perhaps reflecting consumers adapting to their diminished spending power.

Encouragingly, more than four in 10 (46%) said they will always find money to spend on areas that are important to them, even if prices rise, with 40% saying they would ring-fence part of their income for social occasions such as going to the pub or for meals out.

Paul Lockstone, managing director at Barclaycard, said: "Consumer spending growth slowed for the second month running in June, ending the quarter on a muted note. As shoppers devoted more of their budget to day-to-day essentials, they rowed back on nice-to-haves. While some aspects of the ‘experience economy' remained protected, the cooling down of entertainment growth to single figures shows even this may be vulnerable.

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