Consumer spending increased in the last month of 2022 despite rising inflation, according to new data.
Figures from Nielsen’s for the final four weeks of last year, revealed total till value grew from 7.6% to 10.9%. Spending habit in the week of Christmas were led by a desire to socialise with chocolate confectionary (£32m), fresh meat and cheese (£26m), milk (£22m), still wine (£20m) and crisps and snacks (£17m).
Head of retailer and business insight, Mike Watkins said: “Shoppers were still willing to buy extra Christmas indulgences, but the performance of the industry was shaped by the cost-of-living crisis and the need to save on grocery shopping.
“Looking ahead, weak confidence around personal finances and a squeeze on disposable income will have a big impact on demand over the full year. We estimate total food retail growth in 2023 to be around 5%, a total of £190bn across all channels. However, we also expect the recession to start to influence shopper behaviour and reframe overall retail spend.”
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Aldi was the fastest growing retailer over the 12 weeks in the run up to the festive season, with a 19.3% rise in sales, with Lidl trailing behind at 15.7%. Morrisons also saw a positive growth in December after a sales decline throughout 2022.
Additionally, consumer card spend remained on the up, growing 4.4% year-on-year in December, despite a 9.3% rise in consumer price inflation.
The figures, published by Barclaycard, show a marginally higher growth of 3.9% in spending one month prior to November.
Director, Esme Harwood, explained: “The retail sector saw noticeable growth in December […] However, it’s worth noting that these figures look more positive in comparison to December 2021, as the spread of Omicron kept Brits away from high streets and hospitality venues.”
“Confidence in household finances saw a small jump, suggesting that consumers are feeling slightly more optimistic about their ability to balance their budgets going into the new year.”
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