UK shoppers have cut spending by most since the COVID lockdown in 2021 | Investment News
LONDON (Reuters) – British shoppers facing soaring inflation cut spending the most in May since the country was locked down by coronavirus in early 2021, a survey showed on Tuesday.
The British Retail Consortium (BRC) said total retail spending was 1.1% lower than a year earlier, the biggest drop since January last year and representing an acceleration from down 0.3% from April.
“Clearly the post-pandemic spending bubble has burst, with retailers facing tougher trading conditions, declining consumer confidence and soaring inflation impacting the purchasing power of consumers. consumers,” said Helen Dickinson, chief executive of BRC.
Furniture, electronics and other big-ticket goods were the hardest hit, but fashion and beauty sales surged as people geared up for vacation and summer, Dickinson said.
The BRC said its “like-for-like” retail sales measure, covering only outlets open in May 2021, showed a 1.5% annual drop in spending after a 1.7% contraction in April. .
The figures are not adjusted for inflation – which hit 9.0% in April – which means that the fall in the volumes of goods purchased will have been much greater than the fall in the money spent.
Data from Barclaycard, covering a wider range of spending, showed spending in May rose 9.3% from a year earlier, reflecting rising costs of living and a rebound in travel and tourism. accommodation that were affected by the restrictions last year.
Spending on basic necessities rose 4.8%, led by a jump of almost 25% for petrol and diesel, the price of which soared. In response, consumers reduced their spending on digital content and subscriptions by almost 6%.
Echoing data from the BRC, Barclaycard said spending on furniture fell 3.1% in May compared to April.
Spending in restaurants and pubs and bars fell by around 6% and 1% respectively during the month.
“The cost of living squeeze is clearly influencing discretionary spending habits,” said Jose Carvalho, head of consumer products at Barclaycard.
“Despite this, there are encouraging signs, particularly in the travel industry, as Britons’ appetite for the abroad continues to grow as the summer holidays approach.”
Travel spending nearly tripled from May last year, when many international restrictions were in place and travel agents reported a 24% increase in May compared to April.
(Reporting by William Schomberg; Editing by Andy Bruce)
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