Latest UK consumer spending index data from Visa, compiled by finance data company Markit, has indicated that consumer spending declined for the third month running in November. On an annual basis, total expenditure fell by -0.9%, which was less severe than the -2.1% reduction seen in October, but nonetheless kept spending on track for its weakest calendar performance for five years.
Expenditure on the High Street declined for the seventh month in a row on an annual basis in November, declining by -3.5% overall. Although this marked an improvement from the -5.1% decline in October, it was still one of the strongest reductions recorded since 2012. Meanwhile, E-commerce spending continued on an upward trend, though the growth rate of +2.4% remained modest in the context of the survey's history.
Chief officer of commercial at Visa, Mark Antipof, commented: "Festive cheer was in short supply for the UK’s retailers during last month as Black Friday promotions failed to lift consumer spending. November’s poor performance means that we stand by our earlier prediction that the UK will see its first fall in overall Christmas spending by consumers since 2012.
"The gap between the performance of e-commerce and the high street widened again last month. Bricks-and-mortar retailers saw sales down for the seventh consecutive month, while e-commerce continued its upward growth trend, boosted in particular by consumers taking advantage of online promotions around Black Friday."
On a sector basis, six of the eight broad spending categories registered lower spending in November, with household goods recording a loss of 2.0%, a slight boost from October's -3.8%.
Face-to-Face spending fell by -3.5% year-on-year midway through the final quarter of 2017. Although this was less severe than in October (-5.1%), it was nonetheless one of the steepest rates of reduction since 2012.
Principal economist at IHS Markit, Annabel Fiddes, said: "Overall, the figures add to the relatively downbeat assessment of UK consumer spending, as households’ budgets continue to be squeezed by rising living costs and lacklustre wage growth. Unless the squeeze on households unwinds and consumer confidence strengthens, it seems unlikely that consumer spending trends will improve anytime soon."