Consumer card spending sees uplift in November as festive shopping boosts retail

Consumer card spending grew 2.9% year-on-year in November, less than the latest CPIH inflation rate of 4.7% but higher than October’s 2.6% growth, as shoppers “got into the festive spirit early”.

Brits’ confidence in their ability to spend on non-essential items (56%) also reached its highest level since April 2023, according to the latest data from Barclays, which sees nearly half of the nation’s credit and debit card transactions.

The high street “received a welcome boost from month-long Black Friday sales”, as well as the late arrival of cold and wet weather, which encouraged shoppers to update their winter wardrobes, with clothing and department store spending up 2.8% and 5% respectively.

Other findings include:

• Transactions on Sunday 26 November (dubbed ‘Super Sunday’) outpaced Black Friday by 13.5%, demonstrating it is no longer a single-day event.
• Brits expect to spend an average of £105.43 more on Christmas this year than in 2022, with festive food and drink expected to be the largest contributor – rising by an average of £25.87, followed by gifts (+£18.62) and activities (+£11.86).
• “Revenge spending” is boosting the travel sector again, having recorded double-digit growth for 11 of the last 12 months - as a fifth (19%) of consumers are planning more holidays in 2024 “to catch up on trips missed during lockdowns”.
• Confidence in personal finances improved, while concerns about inflation and food prices fell to their lowest levels since December 2021.

Esme Harwood, Director at Barclays, said: “Shoppers got into the festive spirit early this year, flocking to the high street to take advantage of month-long Black Friday sales, and unlocking long-awaited retail growth.

“November also marked a turning point for consumer sentiment – confidence in personal finances improved, with Brits starting to feel less concerned about some of 2023’s defining issues, such as inflation, interest rates, and food prices – so there are reasons to be cautiously optimistic as we look ahead to Christmas and the New Year.”

Jack Meaning, Chief UK Economist at Barclays, commented: “This data suggests consumers are continuing to spend more but get less for their money, as spending growth remains below inflation. However, the gap is narrowing as the rate of price increases slows, and we expect it to narrow further in the coming months.

“It’s reassuring to see that some of the previous weakness in spending was due to unseasonal weather, as shoppers go out and finally buy that new winter coat and get in the Christmas spirit. But the key question for the UK is what happens after the holiday period – it will take more than a festive bounce to keep consumers spending in 2024.”