British consumer spending rebounds as heatwave overrides caution

Annual consumer spending grew by 0.8% in May, a modest recovery from the 0.1% contraction seen the previous month. Data from Barclays indicates that while this growth remains well below the current 3% inflation rate, the shift was bolstered by high-street demand for clothing, health, and beauty products. The British Retail Consortium reported a 3.7% increase in total retail sales, the strongest performance since April 2025, with food and non-food sectors rising by 3.9% and 3.5% respectively.

Despite the retail uptick, the travel sector faces a persistent slowdown. Expenditure on travel dropped 5.8% in May, marking a third consecutive month of decline, with airline spending plummeting 12.9% compared to the previous year. BRC chief executive Helen Dickinson noted that the heatwave triggered a surge in demand for summer essentials like sandals, sunglasses, and barbecue supplies, yet the broader climate remains fragile. Barclays found that two-thirds of consumers are actively adjusting their finances to navigate persistent economic uncertainty, suggesting that the recent spending spike may be a temporary reaction to the weather rather than a shift in long-term confidence.