Business

Consumer spending surveys give mixed messages

  • 7 January 2013
  • From the section Business
Oxford Street
High Street spending fell by 2% in December despite the late Christmas rush

UK consumer spending fell in December despite a late Christmas rush, a survey has suggested.

Spending was down by 1.7% on a year earlier, and by 0.9% on the previous month, with the High Street particularly weak, Visa Europe's expenditure index found.

Household goods spending slumped by 9.2% year-on-year, while money spent on food and drink was down 2.2%.

But a separate survey from MasterCard found retail sales rose in December.

It found that sales excluding petrol rose by 3.9% against a year earlier.

"Retail sales had a slow start in December... [but] households left their Christmas shopping until the last minute and gave a late boost to retail sales on the High Street and online," said Shweta Chaudhury at MasterCard Spending Plus.

'Disappointingly weak'

The Visa survey painted a different picture.

It showed High Street spending down 2% from a year earlier, with online spend 0.4% lower. Over the final three months of the year, total spending fell by 0.9%, the index suggested.

"Consumer spending remained disappointingly weak in December," said Chris Williamson, chief economist at Markit, which compiled the index.

"With consumers playing an important role in fuelling the 0.9% GDP increase in the third quarter, the drop in fourth quarter spending raises the likelihood that the economy may have contracted again."

The Visa index is based on figures for spending on Visa cards, which are then adjusted to reflect wider consumer spending.

A clearer picture of UK consumer spending in December should be available when the British Retail Consortium reports its retail sales figures on 8 January.

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