Current AffairsEconomy

Hospitality remains strong despite consumer spending slowdown

The hospitality sector showed strong growth during a “sharper slowdown” in consumer spending in April, according to Visa’s consumer spending index.

The data, compiled by Markit, showed that the overall growth was at its weakest pace for three months, with just a 0.5% year-on-year increase. However, bars, hotels and restaurants saw the strongest growth with a 9% uplift.

Kevin Jenkins, UK & Ireland managing director at Visa, said: “Consumer spending slowed down further in April, as consumers tightened their belts in the face of rising prices running up against stalling wage growth. Annual spending growth fell back to 0.5%, from an already subdued rate of 1% in March.”

He added: “Easter and the extended half-term break may have contributed towards a strong uplift of over 9% in the hospitality sector.”

Annabel Fiddes, economist at IHS Markit, said: “The trend of relatively modest expenditure growth is likely to extend in to the coming months, as consumers are squeezed by both rising living costs and relatively lacklustre wage growth.”

In other sectors, food and drink sales were up 6% in April, while clothing and footwear retailers saw a consumer spending increase of 2.3%.

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