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Consumer spending hit a 13-month high in August as Brits overspent on holiday

Helen Cahill
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Off into the sunset - the fall in sterling made holidays more expensive (Source: Getty)

Consumer spending hit a 13-month high in August, boosted by the nation's holiday overspend on the back of the decline in the value of sterling.

Overall, spending increased by 4.2 per cent year-on-year in July, according to Barclaycard, which collects data on consumer spending in everything from retail to food and leisure.

Holiday spending boosted the overall growth in August. Travel spend was up by 3.2 per cent, with hotel spending up 14.9 per cent, it's largest annual jump in two years.

This surge was mainly due to the depreciation of the pound, which will have made overseas accommodation more expensive.

Read more: Here's how much Brits have overspent on holiday due to sterling's slide

Retail analyst Richard Hyman has estimated that, as a nation, we overspent to the tune of £500m this summer due to fall in sterling.

Cinema spending "continued to perform strongly", Barclaycard said, up by 14.6 per cent. Spending in pubs and restaurants were up by 13.3 per cent and 12.7 per cent respectively.

Paul Lockstone, managing director at Barclaycard, said: "Consumer spending has continued to grow after the EU referendum, with August being a particular stand-out month considering confidence in household finances remains low compared to levels seen last year.

"Spending peaks in travel and hotels indicate that most consumers were firmly committed to their summer plans, and spent on trips and excursions they booked months in advance."

However, he added that it is probably too soon to know whether "this lift in spending will last once everyone's holiday tans have faded."

Barclaycard processes nearly half of the country's credit and debit card transcations, offering detailed data into how we've been spending our cash. This data is based on the period from 24 July to 20 August this year.

Barclaycard processes nearly half of the country's credit and debit card transcations, offering detailed data into how we've been spending our cash. This data is based on the period from 24 July to 20 August this year.

How it works - Barclaycard's consumer spending data

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