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UK card spending shows pre-Christmas pick-up: ONS
Global Banking & Finance Review®
Company
By David Milliken
LONDON (Reuters) -British consumer spending picked up in early December, in line with usual seasonal trends as people spent more in the run-up to Christmas, despite a surging cost of living, the Office for National Statistics said on Thursday.
Credit and debit card spending in the week to Dec. 1 – which included ‘Black Friday’ sales promotions – was 13 percentage points higher than a week earlier, according to interbank payments data, which the Bank of England provides to the ONS.
However, spending was flat compared with a year earlier – reflecting a sharp real-terms decline given the high rate of inflation, which hit a 41-year high of 11.1% in October.
Compared with a year ago, spending on commuting and other work-related expenses was up by 16 percentage points and spending on socialising was 5 percentage points higher, but spending on discretionary items such as clothing and furniture was down by 10 percentage points.
The BoE data contrasts with debit card transaction data from card provider Revolut, also published by the ONS on Thursday, which showed a 17 percentage point year-on-year rise in spending and a 4 percentage point increase in the week to Dec. 4.
The weekly increase in the Revolut data was driven by a 13-point rise in entertainment spending.
“Consumer behaviour indicators mostly showed increased activity in the latest week, in line with expected pre-Christmas trends,” the ONS said.
Britain’s most recent official retail sales data – which unlike the weekly numbers are adjusted for inflation and the time of year – showed that sales volumes in October were 6.1% lower than a year earlier.
(Reporting by David Milliken; Editing by William James)
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power. It is typically measured by the Consumer Price Index (CPI).
Credit and debit cards are payment cards issued by financial institutions that allow consumers to make purchases. Credit cards allow borrowing up to a limit, while debit cards draw directly from the user's bank account.
The Bank of England is the central bank of the United Kingdom, responsible for issuing currency, managing monetary policy, and overseeing financial stability.
Retail sales data is a measure of the total sales of goods and services by retailers over a specific period, providing insights into consumer spending trends.
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