First Data Corp reported that January's harsh weather significantly lowered consumer spending from the previous month.
The firm's monthly SpendTrend Report documented a dollar volume growth of 2.5%, down from December’s 3.4% growth, as severe winter weather pummeled the Midwest and eastern half of the country and curbed consumers’ ability to shop and visit stores. Overall transaction growth of 2.1% in January also slowed from December’s growth of 3.1%, the report said.
But while some retailers saw lower spending, others saw increases. Food & beverage stores, general merchandise stores and building material & supply dealers saw robust growth at 3.7%, 2.1% and 4.5% respectively, as consumers stocked up on necessities and winter related items, the processor reported.
“The harsh weather conditions in January subdued some of the consumer spending growth and negatively impacted shopper foot-traffic; however, consumers also shifted their attention toward basic commodities versus more discretionary items in preparation and response to the severe weather,” said Krish Mantripragada, First Data senior vice president, Information and Analytics Solutions. “Spending on credit continued to exhibit healthy growth in January as lending standards continued to ease and consumer confident levels remained relatively positive.”