Pubs, bars and clubs saw consumer credit and debit card spending increase by 3.7% in April, thanks to a boost in trade from the Easter Bank Holiday, the latest Barclays data has found.
But although the rise is higher than the 3.2% seen in March, it is less than the average rise in consumer spend last month of 4.3% - less than half the latest CIPH inflation rate of 8.9%.
While pubs saw an uptick in sales, restaurants saw an even steeper drop in average spend than in March, down by 7.6% last month, compared to a decline of 5.6% in March, with eating out one of the most popular areas for British consumers to cutback on when it comes to discretionary spending.
Spend on takeaways and fast food increased (+9%) as consumers choose to stay in an opt for a takeaway at home instead.
Overall, the eating and drinking out sector saw spend increase by 4.6%, with transaction growth of 2%.
Although average growth in consumer spending is significantly behind inflation levels, the survey found that consumers are feeling noticeably more confident in their household finances and ability to spend on non-essential items (67% and 56%, respectively), compared to the previous month (59% and 48%, respectively).
Optimism in the future of the UK economy also increased to 25%, up two percentage points on March.
“High inflation continues to squeeze real household disposable incomes and constrain consumption. However, this has been somewhat offset by the decline in wholesale energy prices and the price cap on household energy bills, which are contributing to an improvement in consumer confidence,” Abbas Khan, UK economist at Barclays, said.
“The data suggests that pockets of the economy, particularly the leisure sector, enjoyed some renewed momentum in April. Going forward, while energy bills are set to fall from Q3, higher mortgage rates cloud the outlook as households continue to refinance at significantly higher rates through the year.”
