Despite weakening business activity in the wider economy and fragile consumer confidence, latest data from Visa shows that shoppers are still spending relatively freely.
Its monthly index shows that consumer spending rose 1.6% year-on-year in July, up from a growth rate of 0.9% in June and the biggest rise in three months. The data suggested that the warmer weather has driven demand for summer clothing and eating out.
Kevin Jenkins, UK & Ireland Managing Director at Visa, commented: “July’s data suggests that UK consumer spending is holding up despite the ongoing uncertainty following the referendum, albeit at lower levels of growth than we’ve seen in the last couple of years.
“Looking at the last three months, the index indicates that consumers remain cautious with their spending. Overall growth is hovering nearly one percentage point below the average seen over the past two years.”
Separate data from released last week by BDO showed that retail sales in July narrowly missed falling into negative territory but only through widespread discounting.