The month of June saw a 0.9% annual rate of growth in the UK, according to Visa's UK Consumer Spending Index. The index, which was compiled by Markit on behalf of the American financial services firm, is based on spending on Visa debit, credit and prepaid cards, which together account for one-third of all spending in the country.
A report on the index seen by IBTimes UK showed that the June growth was slightly more than May's 0.8% annual growth, which had then marked a 27-month low. However in terms of quarterly performance, the report said that the 2016 second quarter ending 30 June, had witnessed the weakest spending since the first quarter of 2014. The report added that this comes while the full impact of the Brexit vote is yet to be felt.
Other highlights of the report were that June saw a 4.2% decline in spending on transport & communications, which includes flight bookings and car purchases, while hotels, bars & restaurants, saw the slowest increase since January 2013, of 3.3%.
A sector that saw a faster pace of spending growth was e-commerce. While it grew at an annual rate of 4.6%, it offset a further decline in face-to-face expenditure of 1.3% in June. With regards to an overall picture, the report said, "While the vast majority of broad spending categories saw expenditure increase during June, the rates of expansion in key sectors remained relatively muted."
In terms of annual growth rates by sector, recreation & culture saw the highest annual spending growth of 5.8% for the month, followed by hotels, restaurants & bars. The household goods sector came in third witnessing an annual growth of 3.2% for the month.
Kevin Jenkins, the UK & Ireland managing director at Visa was quoted in the report as saying, "All eyes will be on consumer spending data as we assess the outcome of the referendum. With the result coming late in the month, this report doesn't give the full picture but there's a clear trend over recent months showing a slowdown in overall growth."