Consumer spend in the UK fell for the third month in a row in July, the first time overall spending has fallen for three consecutive months since February 2013, according to a report.
Visa’s UK Consumer Spending Index shows that spending fell by 0.8 per cent year-on-year in last month, after declines also recorded in May and June.
The fall in spending in July marked the first time since early 2013 that spending has declined annually for this length of time.
Visa said this was evidence that households were feeling the squeeze from rising prices and stagnant wage growth.
Overall spending on the high street declined by 3.7 per cent, a stark contrast to the 3.6 per cent rise in spending online.
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While the sector that recorded the biggest annual decline in spending was not retail, but in fact transport and communication with a decline of 6.1 per cent in July, clothing and footwear came in second with spending declining by 5.2 per cent year-on-year.
Food and beverage spending was down by 0.5 per cent annually, while spending on household goods fell by four per cent.
Bucking the trend were hotels, restaurants and bars, as well as recreation and culture, sectors which experienced a six per cent and 1.3 per cent increase in year-on-year spending respectively.
“The drop in spending was felt across a broader range of retail sectors last month, with clothing, household goods, food and transport among the worst hit,” Viza UK managing director Kevin Jenkins said.
“There were still some bright spots in July, with hotels, restaurants and bars reporting a six per cent increase.
“The sector is likely to have benefited from an early surge in summer staycations, as the weak pound made holidaying at home more attractive.”
The Consumer Spending Index uses spending on Visa cards as a base and adjusts the figures to reflect all UK consumer spending, not just that on cards.
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