Barclaycard Data Shows Post-Brexit Vote Consumer Spending Holding Firm in U.K.
Data from Britain's largest credit card provider, Barclaycard, showed on Tuesday that consumer spending has held firm across the U.K. in the wake of the nation's vote to leave the European Union.
The announcement comes as an addition to a regular review of the previous month's consumer spending by the Barclays (BCS) - Get Report subsidiary. Figures for the month of June showed that consumers remained uninhibited during the run-up to the referendum, given that credit card spending rose by 3.6% year-onyear, in line with the increase recorded for May.
Barclaycard has over 10 million credit card customers inside the U.K. and so is well placed to provide insight into domestic demand for personal credit.
In contrast to the earlier GfK NOP consumer sentiment survey that was released last week, Barclaycard found in its own poll carried out between July 5 and July 6, that 52% of households in the U.K. believe that the vote to leave the European Union will have no impact upon their household finances.
This represented a sharp increase upon the 39% of respondents who thought they would be unaffected by a vote to leave the EU when they were polled before the referendum in early June.
The release comes on a morning where defensive assets have been sold off and markets have increasingly rewarded riskier assets, as concerns ease among investors following the announcement that Conservative Party Home Secretary Theresa May will replace David Cameron as Prime Minister as soon as Wednesday.
A perceived center-ground Conservative and a "remain" voter herself, May is seen well placed to preserve as much of the U.K.'s existing relationship with the European Union as possible under Brexit.
House builders and other real estate-focused firms extended Monday's gains during early trading on Tuesday, while banks' shares also continued to rebound strongly.
The earlier consumer confidence survey, by market research firm GfK NOP, polled 2002 consumers between June 30 and July 5. It found that 60% of respondents expected their own economic situation to worsen over the next twelve months, with many of the more downbeat consumers being located in northern England and in Scotland.
Despite the apparent contrast in the two surveys, there are some caveats to many of the insights provided by the Barclaycard survey. 76% of those polled think that the U.K. will return to recession in the near future, while 43% do actually expect their own household finances to deteriorate.
In addition, Barclaycard's analysis of spending among credit card customers found that spending in bars and restaurants was lower than it would normally be in the final week of any given month, which the report states could suggest consumers have adopted a more cautious mindset following the vote. The report did not state by how much spending in bars and pubs has declined.