Consumer spending dropped by 1% in December 2018, with the high street taking a particuarly heavy blow in the run up to Christmas, new figures have shown.
The fall marks the strongest hit seen since April last year, having accelerated from a 0.7% decline in November 2018, according to Visa’s UK Consumer Spending Index.
The low expenditure was largely driven by a disappointing performance by the high street as in store sales fell 1.6% on an annual basis in December.
Online spend had edged up by 0.5% year on year.
Commenting on the figures, Adolfo Laurenti, European principal economist for Visa, said: “The further decline in UK consumer spending in December 2018 is a disappointment, but not a surprise. Notwithstanding a backdrop of low unemployment and rising wages, households remained very cautious at the end of the year - as they were for most of 2018.
“An acceleration in spending at hotels, restaurants and bars (+7.6% year-on-year) suggests that some categories of discretionary spending are holding up better than the market as a whole. And the modest pick-up in ecommerce point to the resilience of digital channels of distribution, a favorable long-term trend that recent woes have not derailed.”