Consumers are looking to cut spending on essential items in order to splash out on experiences such as summer holidays, according to new data.
People are still keen to book holidays to look forward to later in the year despite ongoing inflationary pressures, the Barclays consumer spending index released today (Tuesday) revealed.
Spending in travel agencies was up by 16.2% in April over the same month last year with transaction growth of 18.9%.
Demand for holidays also saw spend on airlines rise by 32.1% year-on-year – a slight uplift compared to March (28.5%), Barclays found.
This compared with overall card spend growth of just 4.3% over April last year as rising costs continued to place pressure on people’s finances.
Barclays director Esme Harwood said: “The arrival of slightly warmer weather, along with the Easter bank holiday weekend, led to more Brits venturing outside to enjoy social and leisure activities in April.
“Entertainment received a boost, as music fans rushed to book tickets to the Eurovision Song Contest in Liverpool.
“Meanwhile, Brits are still searching for ways to reduce spend on essentials, so they can enjoy experiences such as holidays, shows and concerts.”
Barclays UK economist Abbas Khan added:“High inflation continues to squeeze real household disposable incomes and constrain consumption.
“However, this has been somewhat offset by the decline in wholesale energy prices and the price cap on household energy bills, which are contributing to an improvement in consumer confidence.
“The data suggests that pockets of the economy, particularly the leisure sector, enjoyed some renewed momentum in April.
“Going forward, while energy bills are set to fall from Q3, higher mortgage rates cloud the outlook as households continue to refinance at significantly higher rates through the year.”