Spending on dining out and clothing drops as Brits prioritise travel and entertainment

The delayed sale of Glastonbury tickets and consumers spending money saved for 2024 holidays, however, gave the travel and entertainment sectors a boost in December.

Karen Johnson, Head of Retail at Barclays, said: "Hospitality and leisure businesses will be encouraged by December’s strong growth, particularly in the entertainment category, which saw growing demand for live shows, new films and TV series.

“Meanwhile, grocery and retail spending didn’t see as much of an increase as we might have expected during the height of the festive season.

"This is likely due to many retailers and supermarkets starting discounts and promotional activity earlier than usual, meaning that many Brits had been making the most of these deals and completed most of their Christmas shopping by December.”

Consumer card spending grew 2.3 per cent year-on-year in December, less than the latest CPIH inflation rate of 4.2 per cent and lower than November’s growth of 2.9 per cent.

Retail spending struggled to maintain the momentum it had built up in November through early seasonal discounts, while entertainment and travel thrived as consumers booked experiences and getaways for 2024.

Spending on clothing and in department stores fell back into decline in December, falling 2.0 per cent and 0.2 per cent respectively, after witnessing a spike in November.

Barclays said this is likely due to retailers starting their festive promotional activity earlier in 2023, which encouraged Brits to shop for Christmas party outfits and gifts in November rather than December to take advantage of the best deals.

Spending in restaurants also had its best month since August, but was still in decline, falling by 8.8 per cent.

Spending on shows and concerts grew 13.9 per cent as Brits snapped up tickets for Glastonbury Festival, which were released two weeks later than usual, as well as for Christmas pantomimes and shows.

New blockbuster releases such as Wonka and Aquaman and the Lost Kingdom also boosted cinema spending by 8.0 per cent.

Within the travel sector, spending with airlines rose 20.2 per cent, up from 14 per cent in November, while spending at travel agents rose by 12.8 per cent, up from 9.2 per cent the month prior.

One in seven Brits said that they plan to take more holidays in 2024 than in recent years, while one in 10 said they had been saving up to afford a bigger holiday in 2024.

Barclays noted that the entertainment sector saw considerable growth of 12.3 per cent following a decline of 1.7 per cent in November.

Spending on essential items also slowed, rising just 1.8 per cent compared to 3.3 per cent in November, as falling petrol prices meant fuel spending fell by 12.5 per cent.

The deceleration in food price inflation meant supermarket shopping saw its lowest uplift since September 2022, matching the 2.8 per cent figure seen at that time.

Food and drink specialist stores however, including butchers and delicatessens, saw a notable uptick in spending of 5.1 per cent, as consumers chose to invest in more premium, seasonal ingredients and to support their local businesses in the run up to Christmas.