Report: July card spending slowed overall, but general merchandise jumped sharply
Atlanta -- A report released Tuesday by First Data Corp., which tracks same-store consumer spending by credit, signature debit, PIN debit, EBT cards and checks at U.S. merchant locations, found that card spend growth slowed significantly in July. However, dollar volume growth at general merchandise stores, including value retail, rose 10.3%, the largest increase in 10 months, as value retailers increased merchant promotional activity and discounting to attract consumers.
According to the First Data SpendTrend analysis, overall year-over-year dollar volume growth was 7.3% in July, a sharp slowdown from June’s 8.8% growth rate. Dollar volume growth was hampered by slower increases in average tickets.
Dollar volume growth on credit cards slowed from 10.7% in June to 7.4% in July. Several discretionary retail categories such as travel saw lower credit dollar volume growth. Higher-end consumers likely limited their credit spending due to the uncertain economic climate. Dollar volume growth was spread more evenly across all payment types in July.
“Despite rising input costs from inflation, many retailers have resorted to cutting prices in order to stimulate demand from an increasingly cautious consumer base,” said Silvio Tavares, senior VP and division manager of First Data Information and Analytics Solutions. “This trend could have a negative impact on retailers heading into the peak of the back-to-school shopping season.”