Consumer card spending in UK grew 4.5% y-o-y in April: Barclays

Research conducted in late April showed that seven in 10 UK consumers (72 per cent) were concerned about the impact tariffs could have on their household finances, although this was an improving picture compared to the start of the month (77 per cent). Over a quarter (27 per cent) reported trying to save more money each month to build up a buffer, in case prices rise in the future.

Overall confidence in household finances remains resilient at 70 per cent, while 74 per cent feel able to live within their means, both consistent with March’s figures (70 per cent and 73 per cent respectively). This positive outlook is reflected in the performance of non-essential spending, which was up 5.1 per cent year-on-year, significantly higher than March’s 2.2 per cent increase, and the highest growth since 2023.

The April sunshine and the long Easter weekend prompted shoppers to visit the high street in higher numbers. For the first time since tracking of these categories began in 2019, all retail and hospitality & leisure subcategories saw growth. Overall retail was up 6.8 per cent, while in-store retail spending increased 6.9 per cent, after declining -1.9 per cent year-on-year in March.

As cost-conscious shoppers look to get more value from their weekly shop (66 per cent), a third (33 per cent) have noticed supermarkets lowering prices to match competitor offers and three in 10 have seen more promotional offers and discounts (30 per cent).

Enhanced loyalty schemes (23 per cent), product ‘knockoffs’ or ‘dupes’ (21 per cent) and an improvement in own-brand products (18 per cent) have also been spotted more frequently.

“April’s sunny weather inspired consumers to embrace the best of Britain, with all retail, hospitality, and leisure subcategories in growth for the first time in over five years. While the long-term impact of any tariffs on household finances remains to be seen, given the announcement of a UK/US trade deal, shoppers are demonstrating a commitment to supporting British business, while still carefully managing their money,” Karen Johnson, head of retail at Barclays, said.

“While the world continues to grapple with unprecedented levels of trade uncertainty, UK economic sentiment has been surprisingly positive recently, supported by a resilient consumer. The recent decision by the Bank of England to further lower interest rates should add to this momentum. Similarly, the trade agreement reached between the US and the UK should provide some much needed visibility to businesses. That said, growth is likely to remain muted in absolute terms. These positive developments may only partially offset the consequences of a softer labour market, and a challenging economic backdrop in the rest of the world,” Julien Lafargue, chief market strategist, Barclays Private Bank and Wealth Management, said.

ALCHEMPro News Desk (RR)