// ONS figures show that consumers took to the shops as the latest Covid variant took hold
// Black Friday pushed sales high, while restaurant bookings dropped to the lowest since restrictions have eased
British households spent more on goods and less on services as the Omicron coronavirus variant spread last week, according to the latest data from the Office of National Statistics (ONS).
The ONS figures reveal that last week’s Black Friday pushed spending on credit and debit cards in Britain to its highest level since before the first lockdown of March 2020.
At the same time, restaurant bookings for the week dropped to the lowest they have been since restrictions on indoor hospitality eased in May, suggesting that consumers are keen to complete their Christmas shopping before any further restrictions are introduced.
According to Reuters, Bank of England rate-setters had been counting on the Omicron variant triggering a drop-off in demand for consumer goods – and a shift in spending, towards services such as eating out – to help pull down the rapidly rising inflation, currently on course to hit 5%.
However, the latest development indicates a shift in consumer behaviour similar to that seen earlier in the pandemic, meaning that inflation is likely to remain high.
The Omicron strain of the virus prompted new health restrictions in England to come into force on Wednesday. The new rules fell short of a lockdown, but many retail and leisure businesses are concerned of the effects it will have on trade, particularly during the ‘Golden Quarter’.
The new restrictions are also expected to affect economic growth, with Citi estimating it will decline by 0.4 and 0.3 percentage points in December and January respectively.