Visa confirms a fall in consumer spending
UK spending drops for the first time in almost four years
by Abi Moses on 13th June, 2017
Recently released figures indicate that UK consumer spending fell last month for the first time in almost four years.
Credit card providers, Visa, reported that May's inflation-adjusted figures showed a 0.8% year-on-year fall. The first such drop since September 2013.
Visa's managing director, Kevin Jenkins, said "Our index clearly shows that with rising prices and stalling wage growth, more of us are starting to feel the squeeze."
Economists do not expect June's sales to show any improvement given the diminishing confidence in the UK government. After Theresa May's failure to secure a majority vote in the General Election, the Conservatives will now lead a minority government having controversially struck a partnership with Irish party, the Democratic Unionist Party (DUP).
The British economy is the worst performing of any nation that makes up the Group of Seven (G7) bloc, with retail sales for the first quarter at its lowest since 2010 and new data also displaying a slump in industrial output and construction.
Annabel , a IHS economist said, "The outlook for consumer spending continues to look relatively bleak, with households facing faster increases in living costs and muted wage growth. The squeeze on household finances is likely to get worse as the Bank of England forecasts faster increases in consumer prices in the coming months."
With the UK economy struggling, the Pound has also continued to fall. Will Sterling be able to make up ground on its rivals or will the slump continue? Make a prediction on what the future holds for the UK currency and start trading with any of our brokers today.
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