British Shoppers Increase Spending in September

By Suban Abdulla

LONDON (Reuters) – British shoppers increased their spending slightly in annual terms in September, according to a survey on Tuesday, which indicated that demand for tickets for the reunion of rock band Oasis helped boost entertainment sales.

Barclays reported that spending on discretionary items rose by the most this year, with entertainment jumping by 14.4% – the biggest increase since July 2023, when U.S. singer-songwriter Taylor Swift opened sales for her British concert tour.

According to Barclays, last month's surge in entertainment spending was attributed to the opening of ticket sales for concerts by Oasis, who are reuniting after a 15-year split.

A separate survey from the British Retail Consortium (BRC) also indicated an increase in non-essential spending, despite ongoing concerns about tax rises in finance minister Rachel Reeves' upcoming budget and a looming increase in household energy bills.

The BRC reported that spending in shops increased by 2.0% in annual terms in September, the strongest uptick since March, which recorded a 3.5% increase, albeit less than the 2.7% rise in September 2023.

Reeves, who took office in July following Labour's landslide election victory, is set to deliver her first annual budget on Oct. 30. She has warned that some taxes will increase but has ruled out raising income tax and National Insurance social security rates.

“With energy prices having again risen, all eyes are now on the budget and its potential impact on household discretionary spending in the final quarter,” said Linda Ellett, UK head of consumer, retail and leisure at accountants KPMG, who sponsor the data.

Regulated energy tariffs rose by 10% on Oct. 1, increasing the typical annual bill to £1,717 ($2,244).

Barclays reported that spending on its credit and debit cards rose by 1.2% year-on-year in September, the biggest increase since April, following a rise of 1.0% in August. However, in real terms, this represented a fall, as British consumer price inflation held at 2.2% in September, slightly above the Bank's 2% target.

In contrast, spending on essential items declined by the most since April 2020 during the COVID-19 pandemic, as shoppers sought cheaper deals, with grocery spending falling for the first time since June.

Official retail sales data for August showed a 2.2% rise in retail sales in cash terms, along with a bigger-than-expected 1.0% volume increase.