Consumer card spending grew marginally in March, up 0.5 per cent. That marked a drop from February’s 1.0 per cent increase and meant growth in spending was below the latest CPIH inflation rate of 3.7 per cent.

Essential spending declined once again, having fallen by -1.0 per cent in February. March saw a steeper fall of 2.9 per cent. 

After rising in February, consumer confidence levels fell in March and are now back in line with January’s results. UK consumers’ confidence in their household finances dropped by five percentage points to 70 per cent, while consumers’ confidence in their ability to live within their means is now 74 per cent, a drop of three percentage points from February’s figure.

Research conducted between 8^th-11^th April found that confidence in the UK economy dipped slightly month-on-month to 24 per cent (down from 25 per cent). In comparison, a smaller proportion reported feeling confident in the strength of the global and US economy, both at 20 per cent. 

The decline in essential spending can partly be explained by the fact that nearly two fifths (37 per cent) of UK adults said they were cutting back on spending in anticipation of household bills rising in April.

However, UK consumers’ confidence in their ability to spend on discretionary items remains strong, at 58 per cent, while non-essential spending increased by 2.2 per cent in March.

Three in five (61 per cent) consumers told us that they were budgeting for discretionary or treat purchases each month, showing that a while adopting a cost-saving mindset, people still prioritise spending on things they love. 

Inspired by recent events, almost three quarters (71 per cent) of UK consumers have said that they want to support UK businesses by buying more products that are “Made in Britain”, with two in five saying that they are looking for UK-made alternatives to products they currently buy that are produced abroad.

As part of this, 27 per cent plan to buy British include food and drink, while 20 per cent will be opting for UK clothing/household brands. This consideration comes as almost two in three (65 per cent) report feeling concerned about the impact of recent stock market volatility on their household finances.  

In March, the volume of supermarket transactions fell by -2.6 per cent, suggesting people are shopping less frequently.  Half of consumers (50 per cent) now prefer to do a ‘big shop’ instead of multiple smaller shops throughout the week. When asked why, 52 per cent cited convenience, 50 per cent do so to save time and 39 per cent said it makes it easier to budget and keep costs under control.

Speaking about this, Karen Johnson, Head of Retail at Barclays, said: “Consumers are feeling the pressure of rising bills, alongside being mindful of the impact recent global events may have on their finances. In a bid to keep costs down, households are adopting more prudent budgeting, which has led to a resurgence of the 'big weekly shop'.”

In March, spending on digital content and subscriptions grew by 5.7 per cent. The increase is no doubt in part due to the of Adolescence, as well as buzzy dramas like The White Lotus and The Studio.

Consumer concerns around streamflation continue, meanwhile more than three in 10 (31 per cent) consumers believe they’re getting less value for money from digital content subscriptions.

Of this group, almost a third (32 per cent) say that they have cancelled a subscription as a result, 16 per cent have paused a subscription, 14 per cent limit their number of services they use at a given time and 12 per cent rotate the services they use to keep costs down. 

In February, spending on electronics enjoyed its greatest increase since 2021, at 6.7 per cent, with one potential explanation being that many items bought between 2020 and 2021 were reaching the end of their natural lifecycles.

That trend continued into March, with spending on electronics up by 4.6 per cent, and the volume of transactions up by 18.6 per cent.

In March, travel spending increased 5.7 per cent year-on-year, with both travel agents and airlines enjoying growth of more than seven per cent.

While UK consumers have been carefully managing their money, Barclays research shows that there is still room for spontaneity. Over 60 per cent say they have spent on non-essential items even when they were financially stretched, and, in this regard, the travel industry has been the big winner.

One fifth (21 per cent) of respondents have spent money on trips for which they have not budgeted. Narrowly behind travel in unplanned purchases were days out (20 per cent) and expensive meals (17 per cent).

To find out more about how Barclays sources its data and research, and how it is available for use from clients, you can visit our dedicated page.