UK consumer spending cools ahead of budget and Black Friday promotions
British consumer spending slowed in October as households paused major purchases ahead of the government’s autumn budget and this month’s Black Friday sales, surveys showed Tuesday.
Barclays reported that spending on its credit and debit cards — which cover nearly 40% of UK card transactions — fell 0.8% year-on-year, as essential outlays such as fuel and groceries dropped sharply.
- The data underline a cautious mood in the economy ahead of Finance Minister Rachel Reeves’ November 26 budget, which is widely expected to include tax increases. Barclays strategist Julien Lafargue said both consumers and businesses had adopted a “wait and see” stance, creating short-term headwinds but potentially setting up a rebound if confidence improves into the festive season.
- Meanwhile, the British Retail Consortium (BRC) said retail sales rose 1.6% from a year earlier, marking the weakest annual growth since May.
- BRC chief executive Helen Dickinson said retailers were depending on Black Friday to lift sales but warned that “looming budget decisions risk undermining fragile consumer confidence.” She added that unresolved business rates and weak demand were forcing retailers to make tough choices on investment and hiring.
A separate Barclays survey of 2,000 consumers found one in three delaying big-ticket purchases until after the budget.
- All seven of its confidence indicators declined for the first time since August 2022, when the Bank of England delivered its sharpest rate hike in nearly three decades.
This article was written by Eamonn Sheridan at investinglive.com.