Every quarter KPMG combines qualitative data from more than 100,000 Snoop customers to find out what they are actually spending.
The report said consumer confidence remains volatile and below pre-pandemic levels, with the start of 2025 seeing further decline in confidence.
For January to March 2025 it found that 38% were cutting back on eating out (down 4% on the same period in 2024) while 28% said they are cutting back on drinking out (down 3% on the previous year).
Discretionary spend
Other areas highlighted as being where consumers are cutting back on discretionary spend included takeaway food (34%), clothes and footwear (32%) and entertainment (22%).
However, there is a separation between personal finances and the UK economy, the report said.
Over half of consumers (55%) report that they feel ‘confident’ or ‘comfortable’ with their current financial situation - meaning they can spend freely day-to-day, and another third saying they can manage through budgeting.
Saving continues to be a priority with 36% of consumers saying that their perception of the economy is making them save more.
However, a key concern consumers was the growing anxiety about the UK economy.
Monthly spending
As a result, more than four in 10 people are reassessing their monthly spending, and three in 10 are putting off major purchases. A significant portion of consumers indicated that they will continue spending money on holidays, making it the most popular category.
The report also looked to the future highlighting that the impact of higher tariffs pose a downside risk to the global economy that would likely increase the cost of consumer goods and imported products, leading to higher prices.
As a result, consumers could see more of their income going towards essential goods, leaving less for their discretionary spending.
KPMG’s latest forecasts predict UK consumer spending to rebound from 0.6% growth in 2024 to 1.3% in 2025, before slightly easing to 1.1% in 2026, indicating a gradual recovery in consumer expenditure.
