UK consumer card spending grew by 2.3 per cent year on year in October, its strongest growth in 15 months, according to Barclays, as shoppers budgeted for Christmas but still found room for evenings out.

The rise was up from 2.0 per cent in September and was the highest since July 2025, although it remained below the latest CPIH inflation rate of 3.6 per cent, meaning spending power was still under pressure. Overall transaction growth was 1.7 per cent.

Fuel costs drove essential spending

Essential spending rose 3.1 per cent, up from 2.5 per cent in September, driven by fuel spending climbing 22.7 per cent after diesel passed 2 pounds a litre for the first time. Non-essential spending grew 1.9 per cent, up slightly from 1.8 per cent, with entertainment performing strongly as people spent on nights out despite tighter budgets.

Retail spending told a more cautious story. Barclays data showed retail spending expanded by just 0.5 per cent in October, as shoppers made more transactions but spent less overall. Clothing transactions climbed 5.2 per cent while spending dropped 1.8 per cent, suggesting more frequent but lower-value purchases. Separate figures from the British Retail Consortium showed total retail sales up 1.5 per cent in October, above the three-month average of 1.2 per cent.

Confidence fell before the Budget

All five of Barclays' measures of consumer confidence dipped in October, in the run-up to the Chancellor's Autumn Budget on 28 October. The bank's research found that 40 per cent of consumers are reducing spending now to free up money for Christmas, rising to 53 per cent of Generation Z shoppers and 54 per cent of Millennials.

Rohan Kumar, head of spend insights at Barclays, said October's growth was the strongest in over a year, but people were being careful with their money. Jack Meaning, the bank's chief UK economist, said it was reassuring to see resilient numbers in October as the squeeze on consumers' spending power begins to build.

Shoppers wait for Black Friday

Retailers reported a subdued October as many shoppers delayed spending ahead of Black Friday and Christmas. The Barclays figures suggest households are still spending, but selectively: cutting back on everyday purchases while protecting treats such as entertainment, and waiting for discounts before committing to bigger purchases.

With the Christmas shopping season now under way, the coming weeks will show whether the October resilience holds or whether the dip in confidence turns into a weaker festive period for retailers.