Consumer spending continues to fall in the UK
According to research made by payments company Visa, consumer spending in the UK fell by 0.8% in July, marking this the third consecutive month of decline. This decline was even more intense than the one registered in the previous month (in June this year UK spending fell by 0.2%.). According to the same source, the steepest reduction was seen in Transport & Communication (-6.1% year-on-year), followed by Clothing & Footwear categories (-5.2%). Moreover, the latter saw the second fastest drop in spending since April 2012 (after May this year). Visa UK and Ireland Managing Director, Kevin Jenkins highlighted the continued pressure on household’s income: “Consumer spend fell for the third month in a row in July, the first time overall spending had fallen for three consecutive months since February 2013. The figure provides further evidence that rising prices and stagnant wage growth are squeezing consumers’ pockets. The drop in spending was felt across a broader range of retail sectors last month, with clothing, household goods, food and transport among the worst hit. According to the same source rising prices and stagnant wage growth are impacting the UK consumers decisions. Reducing spending also takes place in a time when the UK economy is expanding modestly, while uncertainties in the international markets continue to be felt, and the unsure outcome of the ongoing Brexit negotiations are weighing down on consumer’s confidence.