Consumer Spending

Household budgets continue to tighten amid rising inflation

Spending at supermarkets and specialist food and drink stores decrease as consumers seek value from weekly shop.

Consumer card spending grew 6.2% year-on-year in June, but concern around rising living costs continues, with consumers feeling less able to live within their means.

Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, reveals that spending on essential items increased 4.4%, largely driven by a surge in fuel spend (24.8%) as petrol and diesel prices continued to climb.

Spending at supermarkets and specialist food and drink stores saw year-on-year decreases of -0.8% and -1.1% respectively, with almost half of consumers (49%) seeking more value from their weekly shop.

In addition, the figures show that although spending at restaurants was down -3.3% compared to June 2021, the category saw a small month-onmonth uplift (0.8%), as did bars, pubs and clubs (up 0.1%). Takeaways and fast food remain popular too, recording growth of 2.3% month-on-month and 9.4% year-on-year, respectively.

The data also reveals more people (91%) are concerned about the negative impact of rising household bills. Consumers are also feeling less optimistic about their ability to live within their means and confidence in the future of the UK economy has decreased slightly.

José Carvalho, head of consumer products at Barclaycard, said: “The continued rise in fuel, food and energy prices means consumers are having to budget and seek out value where they can for both essential and non-essential purchases.

“While this cautionary approach is impacting supermarket and individual basket spend, there are bright spots to be found, with Brits increasing their discretionary spending on entertainment, travel and takeaways as we head into high summer.”