British consumer spending contracted in June due to poor weather, according to surveys published on Tuesday.
The results added to recent signs of the country’s tepid economic growth that the new Labour government has promised to boost.
Barclays said spending on its credit and debit cards fell by 0.6% in annual terms in June – in the first drop it has seen since February 2021.
The group linked the drop to cool weather seen at the start of the month.
Head of retail at Barclays Karen Johnson said, “Once again, our data demonstrates the undeniable impact that unseasonable weather can have on consumer spending.
“The sluggish demand at the start of June even caused some fashion brands to adjust their sales schedules, although I was pleased to see that the situation has since improved with the arrival of sunnier days.”
Similarly, the British Retail Consortium (BRC) said chilly weather was likely the cause of a reported 0.2% drop in sales value in June compared with a year earlier.
This came after a 0.7% rise in May.
The readings chimed with other signs of slowing growth, including business surveys, as the economy rebounded in the first quarter following a recession in the second half of 2023.
New UK Prime Minister Keir Starmer has said that improving economic growth is his top priority.
Starmer’s Labour Party swept to a landslide victory in the parliamentary elections on 4 July.
‘Increasing Confidence’
Barclays said that spending in supermarkets fell for the first time in two years last month, but it added that there were reasons for optimism.
Barclays’ chief UK economist Jack Meaning said, “While June’s data suggests a weak month, the view looking ahead to the second half of the year, as we see it, is one of falling interest rates, growing real incomes, and increasing confidence among consumers to spend and businesses to invest.”
Accountants at KPMG, sponsor of the BRC retail sales survey, said the economic environment was improving but it said that many retailers were still struggling.
Retail sales volumes, excluding petrol, remain slightly below pre-pandemic levels, according to official data.
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