Online consumer spending has declined for the first time since 2013 as British households start to feel the effects of inflation.
New data from Visa‘s ecommerce spending index shows that year-on-year spending growth dropped by 0.1 per cent in April, growing just 0.5 per cent overall.
This marks the slowest rate of growth in four years and points to a dip in consumer confidence.
Despite lacklustre ecommerce spending, Easter helped boost “face-to-face” sales on the high street by 0.3 per cent, marking the highest rate of growth in the food and drink sector for three years.
This boost saw retail miss out, as the leisure and hospitality sectors cashed in during April with a 9.2 per cent boost in year-on-year sales.
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“Consumer spending slowed down further in April, as consumers tightened their belts in the face of rising prices running up against stalling wage growth,” Visa UK managing director Kevin Jenkins said.
“Annual spending growth fell back to 0.5 per cent, from an already subdued rate of 1 per cent in March.”
These figures are echoed in last week‘s data from Deloitte which saw consumer confidence drop by one per cent in the first quarter of 2017.
Deloitte‘s chief economist Ian Stewart said: “Since last summer‘s EU referendum consumer spending has held up well, but with inflation rising and nominal wage growth starting to slow, consumers are beginning to feel a squeeze on their disposable income.
“In March, the rate of inflation stood at 2.3 per cent, above the Bank of England‘s two per cent target and the highest in more than two years.
“There are already some signs that these pressures are contributing to a slowdown in consumer activity.”
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