Consumer card spending contracted -0.5 per cent year-on-year in November – the first decline since July and significantly lower than the latest CPIH inflation rate of 3.2 per cent. Essential spending saw its steepest fall in over five years, down -3.1 per cent. However, non-essential spending remained in growth, at 0.8 per cent, supported by a strong performance from bars, pubs, and clubs (3.5 per cent) and entertainment (10.8 per cent) as Brits prepared for the festive season and enjoyed blockbuster releases at the cinema.

Karen Johnson, Head of Retail at Barclays, said: ‘Brits are still prioritising quality time out with family and friends, evidenced by the strong performance of pubs and cinemas in November. People are finding to find ways to enjoy life’s little luxuries, and the festive season is no exception, with consumers making cutbacks so they can afford magical moments.

“After a tentative recovery, retail’s performance was dampened in early November. However, many shoppers use the Black Friday sales period to get discounted gifts for loved ones and cross items off their wishlists, providing a boost for retailers.”

Jack Meaning, Chief UK Economist at Barclays, said: “ Understandably, a number of factors weighed on consumer spending in November, notably easing consumer confidence post-summer, and expectations that post-Budget, inflation and interest rates will stay higher in the coming months. Looking ahead, the extent to which we see a seasonal bounce around Black Friday and Christmas will serve as a good test of the economy going into 2025.”

Essential spending dropped -3.1 per cent in November – its greatest fall in over five years and the category’s third consecutive month of decline. This was due to a slowdown in supermarket spend, which decreased -1.8 per cent, which comes as two thirds (64 per cent) say they are looking for ways to reduce the cost of their weekly shop, up two percentage points from October.

Consumer confidence in the UK and global economy also declined in the month, both now at 25 per cent, down from 31 per cent and 30 per cent respectively in October. Meanwhile, inflation concerns climbed four percentage points  after falling in October, returning to September levels at 87 per cent.

Despite this, in November, consumers’ confidence in their ability to spend on non-essential items reached its highest level since February, at 58 per cent. This was reflected in the performance of non-essential spending in the month, up 0.8 per cent.

Gladiator II and Wicked spell success for the big screen

It was another golden month for entertainment, with overall spending up 10.8 per cent. Bookings for blockbuster hits Gladiator II, Wicked and Paddington in Peru meant cinema spending increased 22.8 per cent year-on year.

The small screen also proved popular, with growth in spending on digital content & subscriptions ringing in at 8.3 per cent. The live stream of Jake Paul vs. Mike Tyson’s boxing match and popular TV series such as Dune Prophecy and Arcane: League of Legends encouraged Brits to shelter indoors and enjoy a night on the sofa, while streamflation – the rising cost of content subscriptions – continued to have an impact.

Retail on ice

After enjoying three months of growth, retail experienced a lull in the run up to the seasonal sales period, down -2.0 per cent. November’s cold snap hampered high street footfall; general retailers fell -1.7 per cent (after growing 5.2 per cent in October), while clothing and sports & outdoor contracted -5.6 per cent and -11.5 per cent respectively.

Half of Brits (48 per cent) say they are cutting back on discretionary spending, with 49 per cent of this group reducing spending on new clothes and accessories. However, retail’s slowdown could be a result of shoppers holding out for the Black Friday sale at the end of the month; a fifth of festive consumers (19 per cent) said they were planning to take advantage of the seasonal discounts during this period.

Controlling Christmas costs

To keep Christmas expenses under control, a third (34 per cent) of those that celebrate are keeping an eye out for festive offers, while one in four (26 per cent) are buying presents in advance to spread costs. Over a quarter (28 per cent) expect this Christmas to be more expensive than last year – however, this is down from one in three (33 per cent) who said this last year.

Those that think it will be more costly estimate they will spend an additional £304 this year. When asked about anticipated Christmas expenses, presents for loved ones topped the list, with gift-givers expecting to spend £204 each on average. Festive food and drink came in next, at £94, followed by Christmas parties and social events, at £51.

More than a third of Brits (36 per cent) say that because Christmas brings them joy, they are prioritising spending on the festive period this year, even though they are otherwise trying to stick to a budget. Of these seasonal spenders, one third (33 per cent) plan to splurge on meals out with friends and family, while 26 per cent will splash out on an at-home Christmas celebration.

Escaping the winter blues

The overall hospitality & leisure category enjoyed a strong month, up 4.7 per cent. In the run up to Christmas party season, bars, pubs and clubs saw their highest growth since July 2024, up 3.5 per cent. The shorter days and cooler weather closing in also meant indoor venues were in demand, with restaurants, cafes, and bakeries also moving back into growth (2.1 per cent).

Travel increased in November (up 6.0 per cent) largely owing to increased spending at airlines (10.6 per cent) and travel agents (7.3 per cent). Hotels, resorts and accommodation grew by 5.5 per cent, an increase from 3.2 per cent in October 2024 and the category’s highest growth since October 2023, as the winter blues seemingly prompted Brits to book getaways.

Overall growth figures