UK consumers buy British, concerned over import prices following “Liberation Day”
Consumer card spending grew just 0.5 % year-on-year in March – lower than February’s 1.0 % growth and less than the latest CPIH inflation rate of 3.7 %. The sunny weather boosted non-essential categories such as garden centres and food and drink specialist stores. However, in anticipation of rising bills and inflation on imported products, consumers are feeling less confident in their household finances and continue to find ways to cut back on essential costs.
UK consumers’ confidence in both their household finances and ability to live within their means fell back in line with January’s figures following a spike in February, to 70 % (down from 75 %) and 74 % (down from 77 %) respectively. Nearly two fifths (37 %) of UK adults said they were trying to reduce their outgoings in March in anticipation of rising household bills, contributing to a -2.9 % decline in essential spending (in comparison to -1.0 % in February).
Prioritisation of discretionary purchases remains strong, as 61 % report budgeting for these expenses, with the non-essential spending category up 2.2 % year-on-year.
Move towards “Made in Britain” in response to trade tariffs
In light of recent events, two thirds (67 %) of consumers are concerned that the products they buy from outside the UK will become more expensive. Meanwhile, three quarters (71 %) say they want to support UK businesses by buying more products that are “Made in Britain”. Two in five (40 %) say they are looking for UK-made alternatives to products they currently buy that are produced abroad.
Research conducted between 8-11 April found that confidence in the UK economy dipped slightly month-on-month in March to 24 % (down from 25 %). In comparison, a smaller proportion reported feeling confident in the strength of the global and US economy, both at 20 %.
The return of the ‘big shop’
The volume of supermarket transactions continued to fall in March, down -2.6 % following a -3.7 % decline in February, suggesting a move away from regular ‘top up’ shops. Half of consumers (50 %) say they now prefer to do a ‘big shop’ instead of multiple smaller shops throughout the week, citing the benefits of convenience (52 %) and time saving (50 %), while two in five (39 %) say it makes it easier to budget and keep costs under control.
Food and drink specialist stores potentially benefitted from a dip in supermarket spending, enjoying their highest growth since October 2023, up 4.3 %, perhaps also due to the increasing popularity of artisan and locally made produce.
Garden centres seed growth for household spending
Despite retail spend falling -0.2 % in March (down from 0.6 % growth in February), several subcategories outperformed in the month. Once again, pharmacy, health & beauty emerged as an outlier, up 11.0 % – the category’s greatest increase since April 2022.
Garden centres rose 13.4 % – the biggest spike seen since Barclays started tracking the category in January 2024 – and spending on home improvements & DIY moved into growth (0.9 %) for the first time since June 2023. This comes as a quarter (23 %) of UK adults say they are intending to garden over the Easter Bank Holiday weekend, with one in eight (13 %) planning DIY, suggesting both categories will continue to perform strongly in April.
Experiences top retail
In contrast to retail’s decline (down -0.2 %), spending on hospitality & leisure increased 2.8 % in March, suggesting consumers prioritised experiences and making memories over material goods.
Travel spend was up 5.7 % year-on-year (up from 5.1 % in February), and both travel agents (7.1 %) and airlines (7.4 %) saw strong growth. Three fifths (61 %) of consumers say they have spent on non-essential items even when were financially stretched, with holidays emerging as the top priority purchase. One in five (21 %) admit to spending money on trips they had not budgeted for, with other unbudgeted fun including days out (20 %) and expensive meals (17 %).
Screentime holds steady despite subscription concerns
Spending on digital content and subscriptions (up 5.7 %) continued to benefit from popular TV shows such as Adolescence and The White Lotus. However, as prices rise, three in 10 (31 %) believe they’re now getting less value for money from their digital content and subscriptions.
As a result, a third (32 %) of this group have cancelled a subscription, and 16 % have paused or suspended their payments. One in seven (14 %) limit themselves to a set number of services to keep costs under control, and a similar proportion (12 %) rotate services so they’re only paying when there is content they want to watch.
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’.
“There are some welcome green shoots however, as the warmer weather and longer evenings encouraged consumers to invest time and money in gardening and DIY- a trend that looks set to continue in the run up to Easter.”
Jack Meaning, chief UK economist at Barclays, said: “Following stronger than expected GDP growth in February, today’s data highlights the risks to consumer spending in the months ahead. The impacts of heightened uncertainty and rising bills are already being felt. We expect spending to remain muted through mid-2025, before picking up into 2026 as interest rates easing starts to be felt and uncertainty begins to normalise.”
Overall growth figures
| Spend Growth | Transaction Growth | |
| Essential | -2.9% | -0.9% |
| Non Essential | 2.2% | 1.9% |
| OVERALL | 0.5% | 0.8% |
| Retail | -0.2% | 0.6% |
| Clothing | 1.1% | 3.7% |
| Grocery | -3.2% | -0.1% |
| -4.0% | -2.6% |
| 4.3% | 13.6% |
| Household | 2.9% | 6.7% |
| 0.9% | -3.9% |
| 4.6% | 18.5% |
| 1.8% | -1.5% |
| 13.4% | 6.8% |
| General Retailers | 0.3% | 0.3% |
| 1.7% | 0.9% |
| -3.2% | 0.7% |
| -3.1% | -2.7% |
| Specialist Retailers | 4.4% | -0.1% |
| 11.0% | 2.8% |
| -3.5% | -2.6% |
| 2.0% | -2.7% |
| Hospitality & Leisure | 2.8% | 0.7% |
| Digital Content & Subscription | 5.7% | 5.2% |
| Eating & Drinking | -0.2% | -1.0% |
| -0.2% | 0.5% |
| 0.8% | 1.4% |
| -0.8% | -4.2% |
| Entertainment | 3.5% | 3.5% |
| Hotels, Resorts & Accommodation | 0.8% | -0.9% |
| Travel | 5.7% | 0.3% |
| 7.1% | 13.1% |
| 7.4% | -1.3% |
| 2.8% | -3.3% |
| 2.4% | 6.9% |
| Other | -1.2% | 1.7% |
| Fuel | -8.0% | -4.4% |
| Motoring | -5.0% | 6.1% |
| Other Services | 4.3% | 6.5% |
| Insperiences | 2.2% | 0.7% |
| Online | 2.8% | 4.0% |
| Face-to-Face | -1.5% | -0.6% |