Consumer spending falls

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Consumer spending fell 7.2% in March compared to the same period in 2019, as lockdown continued, new research reveals.

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Data from Barclaycard, which sees nearly half of the nation’s credit and debit card transactions, shows that spending on essential items grew 7.7% compared to March 2019, the highest growth so far this year. This was bolstered by food and drink specialist stores – including butchers, greengrocers, fresh food boxes and meal-kit products – which saw a 71.4% increase in spend.

Supermarket shopping rose 21.9% overall, with online grocery spend surging 116.5%, as home deliveries remained in high demand.

Home improvements and DIY rose 34.4% in March – the highest growth in the category since July 2020 – as more households bought items to prepare their homes and gardens for the warmer months.

Confidence in the UK economy remains at 28%, although some consumers are sceptical about the UK’s longer-term prospects, with 61% expecting that there will be another lockdown in the UK before the end of the year. On the other hand, the number of Brits feeling upbeat about their household finances rose from 68% in February to 72% in March, the research finds.

Raheel Ahmed, head of consumer products, said: “With springtime finally here and restrictions starting to ease, it’s encouraging to see a renewed sense of optimism across much of the UK. There are also signs that some of those sectors most heavily impacted by the pandemic, such as hotels, resorts, accommodation and entertainment, are beginning to turn a corner, as many look forward to long-awaited trips and activities with family and friends after lockdown.

“As Brits spent March sprucing up their homes and garden in preparation for warmer weather, DIY stores also enjoyed significant growth. While it remains a very challenging environment for high-street and hospitality outlets, the fact that many consumers are making plans for the future is a positive sign, and we hope to see this pent-up demand lead to growth in more categories as life after lockdown starts to resume.”