Belfast Telegraph

Home News UK

'Murky' outlook as spending slows

The continuing squeeze on household incomes saw consumer spending growth slow during January, according to figures from Barclaycard.

It grew by just 2.2% for most of the month and though the overall increase was 4.2%, this was skewed by a four-day period flattered by comparisons with a spell depressed by heavy snow last year.

Spending had grown by 3% in November and 2.9% in December in the run-up to Christmas.

The slowdown in January was blamed on the continuing fall in real wages, with pay still lagging behind inflation, squeezing household finances.

Spending on utilities was down 14.8%, with less energy needed for heating homes as the weather was milder this year, while supermarket spending was off by 1.7%.

However, restaurant spending was up by 16.6%, for women's clothing it rose by 11.3%, and hotels saw an increase of 8.9%, according to the data from Barclaycard, which processes nearly half of all UK debit and credit card transactions.

The average amount spent per transaction continued to come down, falling 3.3% on last year and 5.3% on 2012, as shoppers continue to search for value for money.

Val Soranno Keating, chief executive of Barclaycard, said: "The economic outlook for 2014 remains murky and mixed.

"Despite recent positive economic news, real wage growth has fallen by just over 2% for each of the past three years.

"If the economic recovery is to continue, we need to see improved consumer and business confidence flow through to actual wage increases."


From Belfast Telegraph