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Consumer spending hit a seven-month high in February as higher wage growth, falling inflation and lower petrol costs left consumers with more money to spend on leisure and travel.
This is according to Barclaycard’s monthly consumer spending index which shows that, following a slight dip at the start of the year, retail consumer spending growth rebounded in February to the 4.1% level seen over the Christmas period.
Consumers put extra budget towards holidaying abroad, in particular during the half-term holiday, as the number of travel transactions climbed 26% on the same time last year, while travel spending was up 8%.
The half-term holidays also saw hotel spending hit a five-month high, up 9.5% on the back of an 11.5% increase in the number of transactions.
Airline spending also picked up, growing 3.8%– nearly double the growth seen in January – with transactions up 11.8%.
Each of the 12 UK regions that Barclaycard monitors saw real spend growth, with London seeing the highest growth of 4.8%. Wales saw the strongest growth in both regional restaurant and hotel spending, at 23% and 17% respectively.
Chris Wood, managing director at Barclaycard, said: “A combination of higher wage growth, record-low inflation and an effective fuel-tax cut in the form of lower forecourt prices made February a good month for consumers, with many benefitting from having extra money in their pockets in time for the half-term holidays.
“Spending was up across the board, but discretionary purchases saw the highest levels of growth and leisure and travel really took off.”
