As eat out scheme kicks in...
Spending rises amid caution ahead of output data
More shoppers are on the streets
Spending by shoppers rose last month to its highest since the country went into the coronavirus lockdown in March.
Figures from Barclaycard and the British Retail Consortium showed near normal spending, though they come ahead of the end of the job retention schemes which are expected to see a sharp rise in unemployment.
Barclaycard said consumer spending was 2.6% lower than in July 2019, the smallest shortfall since the lockdown began.
“However, a sense of cautiousness still prevails,” Barclaycard director Esme Harwood said.
Government figures due out on Wednesday are likely output between April and June fell as much as 20%, while the jobless rate is predicted to almost double to 7.5% by the end of this year.
Pubs and restaurants reopening contributed to last month’s uplift and this month will see a benefit from the “eat out to help out” scheme which has been taken up more than 10.5 million times in its first week, the Treasury has said.
Under the scheme, which is intended to boost the struggling hospitality sector, the government pays for 50% of a meal eaten at a cafe, restaurant or pub on a Monday, Tuesday or Wednesday. The discount, which is due to run through August, is capped at £10.
Treasury estimates put the average claim at close to £5, making the cost of the policy around £50m so far.
Figures for July from the British Retail Consortium show total retail spending across its members – mostly large chains – was 3.2% higher than a year earlier, close to June’s 3.4% rise, the biggest increase since May 2018.
“The strongest performance came from food, furniture and homeware, as consumers increasingly invest in their time at home. However many shops, particularly in fashion, jewellery and beauty, are still struggling to survive,” BRC chief executive Helen Dickinson said.