Consumer spending in restaurants saw a decline in February, down 3% on 2021 figures, according to the latest credit and debit card spending data from Barclays.
Spend in pubs, bars and clubs was up on January figures (+18.1%), but by a smaller percentage – up 7.7%, although Barclays notes the overlap with Plan B restrictions last year.
Overall consumer card spending grew by 5.9% last month, below the latest CPIH inflation rate of 8.8%, owing to a reduction in discretionary purchases amidst the ongoing the cost-of-living squeeze.
Spending on groceries increased just 6.6% in February – well below the latest food price inflation figures – as almost seven in 10 (68%) of British consumers stating that they are looking for ways to reduce the cost of their weekly shop.
Almost half of these shoppers are cutting down on luxuries or one-off treats for themselves (49%), while a similar proportion are buying more budget / value ranges (48%) and making a shopping list so they only buy what they need (46%).
“Several categories saw their growth taper off last month, especially those in the hospitality & leisure sector. This is partly because they couldn’t match the pent-up demand witnessed at the end of last year’s Plan B restrictions, and also due to the ongoing cutbacks brought on by the cost-of-living squeeze,” Esme Harwood, director at Barclays, said
Silvia Ardagna, head of European economics research at Barclays, added: “Persistent elevated inflation continues to take a toll on spending, as indicated by today’s figures, which could prolong the headwinds.
“However, some survey indicators for consumer confidence, and the recent business activity in the manufacturing and services sectors both point to tentative signs of a rebound. The labour market remains tight, with wage growth too strong for the Bank of England to stop hiking. We expect an additional 25bp increase to the Bank rate in March to 4.25%.”
