UK consumer spending on international travel dipped slightly last month as disposable household income fell and wage growth was outpaced by rising inflation, according to data from Barclaycard.
Card spending grew almost 8% during July compared to the same period in 2021, and nearly 2% compared to June 2022, as Brits spent more on clothing, beauty and staycations as the summer holiday period began.
However, data showed consumers were starting to cut back on overseas travel and eating and drinking out.
Despite spending with travel agents and airlines continuing to grow in July (by 204% and 113% respectively), both categories were down by 4% and 3% month-on-month.
Barclaycard said the drop was likely fuelled by ongoing disruption across the aviation sector as well as 20% of Brits choosing not to holiday overseas this summer and 16% opting for a UK break.
The popularity of domestic holidays was driving spend to UK hotels, resorts and accommodation providers – which grew almost 2% compared to June.
Examining consumer confidence levels, Barclaycard reported 66% of Brits in July were “feeling confident” about their household finances, compared to 59% in June and their ability to spend on non-essential items (54% versus 48%)
Meanwhile, data showed nine-in-10 of consumers (91%) were concerned about rising inflation, surging household bills and higher food prices, while confidence in the future of the UK economy remained low at 26%.