British households ate out less and spent more on goods as the Omicron coronavirus variant spread last week, according to data on Thursday (9) that could mean inflation stays high for longer if it marks a return to behaviour seen earlier in the pandemic.
Bank of England policymakers had been counting on a drop-off in demand for consumer goods - which soared during the pandemic and have been beset by supply-chain difficulties - to pull down rapidly rising inflation, now on course to hit 5 per cent.
British consumer spending had picked up in November, boosted by earlier-than-usual Christmas shopping and a recovery in spending at pubs and restaurants just before the arrival of Omicron variant of the coronavirus in the country. In fact, But Black Friday sales last week pushed spending on credit and debit cards in Britain to its highest level since before the first lockdown of March 2020, the Office for National Statistics (ONS) said.
However, consumer spending behaviour shifted as the news of Omicron came in along with renewed restrictions. Over the same period, cafe chain Pret a Manger reported a drop in sales in 8 out of 10 locations, the ONS said.
Restaurant bookings for the week to Monday fell to their lowest since restrictions on indoor hospitality eased in May, dropping by six percentage points to 5 per cent above the equivalent figure in 2019, according to OpenTable data.
Brian McLister
