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January 2026 - Retail

UK card spending falls to lowest level since 2021 as consumer confidence falters, according to recent research:Research undertaken by Barclays in the latter part of 2025 shows that consumer card spending fell -1.1% year on year, marking the steepest decline since February 2021 (-9.5%); while both essential and non-essential spending shrank amid continued cost-of-living pressures and continued consumer caution.

As part of their Consumer Spend Report, Barclays analysed hundreds of millions of customer card transactions to understand real spending behaviour across essential and non‑essential categories. They also ran a nationally representative consumer survey with 2000 UK adults between 21 and 25 November 2025 to gauge consumer confidence and spending activity.  The findings reveal that as of November 2025, essential spending declined by -2.9%, marking seven consecutive months of decline, while spending on non-essentials fell by -0.3% for the first time since July 2024.

When consumer confidence was analysed across a set of seven key metrics - household finances, job security, non-essential spending, the ability to live within one’s means and the strength of the UK, European and global economies - the findings show that overall confidence was lower in November 2025 compared to the 2025 average. Although adults' confidence in their household finances rose slightly from 63% in October to 64% in November 2025, it was well below 2025’s average of 70%.

Other notable declines in consumer confidence measures when compared to the 2025 average were: ‘non-essential spending’ (52% vs 57%), the ‘ability to live within one's means’ (71% vs 75%), and ‘job security’ 43% vs 47%). Conversely, consumer confidence in the UK and European economies was comparable with the 2025 average.

Further survey insights show that, despite the contraction in overall retail spending, some sectors experienced healthy growth.  Pharmacy, health and beauty spending rose 6.1 % in November as nearly half (45%) of consumers reported they had been focusing more on their wellbeing in 2025.

Commenting at the time of the report’s release, Jack Meaning, Chief UK Economist at Barclays, noted that 2025 has been defined by ‘economic deceleration and it remains to be seen whether economic uncertainty will continue the downward trend in consumer confidence and spending in 2026.

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