BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific
BBCi NEWS   SPORT   WEATHER   WORLD SERVICE   A-Z INDEX     

BBC News World Edition
 You are in: Business  
News Front Page
Africa
Americas
Asia-Pacific
Europe
Middle East
South Asia
UK
Business
E-Commerce
Economy
Market Data
Entertainment
Science/Nature
Technology
Health
-------------
Talking Point
-------------
Country Profiles
In Depth
-------------
Programmes
-------------
BBC Sport
BBC Weather
SERVICES
-------------
EDITIONS
Wednesday, 6 November, 2002, 12:21 GMT
Credit card spending eases
Credit cards
Researchers said it proved consumers were "resilient"
Growth in credit card spending is showing signs of slowing.


Whether the economy now needs an added boost in the form of a lower interest rate remains a difficult decision for the MPC

Steve Round, CCRG Chief Executive
Figures released by the Credit Card Research Group (CCRG) show that total spending on credit and debit cards in September reached 16.8bn, 6.9 % up on the same period last year.

However, this rate of growth is lower than a year ago, when total credit and debit card spending increased by more than 10%.

Debit card spending in September this year grew 8.6% to 8.7bn, while credit card expenditure rose by just 5.1% to 8.2bn.

Service slump

Also, while plastic expenditure in High Street shops remained relatively strong, spending on services has eased significantly.

Overall card expenditure on the High Street was up 11.2% on September 2001, while spending on services grew by just 1.6%.

And in the entertainment, hotel and travel sectors, card spending fell year-on-year, in a sign that consumer sentiment has still not fully recovered from the 11 September attacks.

Card spending on entertainment spending fell by 6.5%, while expenditure on hotels was down by a massive 15.3%, the CCRG said.

Tough call

The CCRG said the continued growth in overall credit card spending confirmed the 'resilience' of British consumers, faced with growing signs of economic weakness.

CCRG Chief Executive Steve Round said the latest statistics would make it difficult for the Bank of England's monetary policy committee (MPC), which holds its monthly meeting this week, to decide whether to cut interest rates.

"Whether the economy now needs an added boost in the form of a lower interest rate remains a difficult decision for the MPC," Mr Round said.

Some economists expect the MPC to cut interest rates by 0.25% to 3.75% this week in order to prop up the economy in the face of a slowdown in Europe and the US.

But others predict that the MPC will leave rates on hold so as not to prolong a potentially inflationary boom in consumer spending and borrowing.

The MPC is due to announce its interest rate decision at midday on Thursday.

See also:

31 Oct 02 | Business
29 Oct 02 | Business
13 Sep 02 | Business
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories

© BBC ^^ Back to top

News Front Page | Africa | Americas | Asia-Pacific | Europe | Middle East |
South Asia | UK | Business | Entertainment | Science/Nature |
Technology | Health | Talking Point | Country Profiles | In Depth |
Programmes