Barclaycard data shows UK consumer spending growth accelerated in July, but retail sales momentum slowed amid caution on big-ticket purchases.
UK consumer spending rose 2.0% year-on-year in July, up from 1.9% in June, as consumer confidence hit a 21-month high, Barclaycard data showed. The increase was driven by World Cup-related spending on food and pubs, masking underlying weakness in retail sales.
BRC retail sales growth slowed to 1.3% in July from 1.9% in June, with like-for-like sales rising just 1.0% compared to 1.7% previously. Non-food sales fell 0.7%, particularly in footwear and clothing, while food sales climbed 3.8%.
Analysts warned of rising food supply chain pressures from Middle East tensions and prolonged heat, which could fuel inflation and strain household budgets ahead of autumn. The mixed data adds uncertainty to sterling and gilt markets before upcoming inflation and retail sales releases.