People are finally spending more on their cards

Is this the sign we've been waiting for?

I may just have spoken to the most optimistic and cheery senior UK-based banker for many a year.

Dave Chan, CEO of Barclaycard Europe, is not just chirpy about the prospects for UK plc; he says that there is evidence going back to the second quarter of the year that we may have turned a corner. In short, people are spending more on their cards.

In May and June, "nominal spend" – that is expenditure taking account of inflation – of Barclaycard cardholders rose for four months in a row for the first time in three years. Given the importance of consumer spending as an engine of growth and with expenditure now on a gentle upward trend, we may indeed be witnessing the recovery starting to gain momentum.

That is however only part of the story. The clever number-crunchers at Barclays have been analysing just what exactly we are using our cards to purchase. There are signs that discretionary expenditure is rising including purchases such as foreign holidays Perhaps the real clincher to back up Chan’s optimism relates to card expenditure on home improvements.

In the past couple of months he says that there has been a big uplift in expenditure in this sector.

Meantime, UK unemployment remains stubbornly high at 7.8 per cent. If the Bank of England forecasts for GDP growth are accurate – and here it has a decidedly mixed track record – we will only enjoy growth of 1.4 per cent this year and 2.3 per cent next year.

For those of us old enough to have lived through economic upturns following past recessions, such relatively low rates of growth are way below the growth levels witnessed during the Thatcher second term and Blair’s first term.

The chances of UK unemployment falling below 7 per cent and the trigger for a change in UK monetary policy – that means higher interest rates to you and me – is slim in the next three years. That inevitably will impact the prospects for the share prices of the major UK banks.

As for home improvements major players, such as B&Q’s parent Kingfisher, there may be renewed interest in how its share price performs. Analysts following Kingfisher are divided with six rating the stock a sell, seven say hold with 13 recommending a buy.

Time will tell if Chan’s grounds for optimism are well founded.

I am glad to report, that at no time during the course of a lengthy conversation did he use the phrase “green shoots” (Norman Lamont circa the 1991 recession).

A handful of credit cards. Photograph: Getty Images

Douglas Blakey is the editor of Retail Banker International

Ukip's Nigel Farage and Paul Nuttall. Photo: Getty
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Is the general election 2017 the end of Ukip?

Ukip led the way to Brexit, but now the party is on less than 10 per cent in the polls. 

Ukip could be finished. Ukip has only ever had two MPs, but it held an outside influence on politics: without it, we’d probably never have had the EU referendum. But Brexit has turned Ukip into a single-issue party without an issue. Ukip’s sole remaining MP, Douglas Carswell, left the party in March 2017, and told Sky News’ Adam Boulton that there was “no point” to the party anymore. 

Not everyone in Ukip has given up, though: Nigel Farage told Peston on Sunday that Ukip “will survive”, and current leader Paul Nuttall will be contesting a seat this year. But Ukip is standing in fewer constituencies than last time thanks to a shortage of both money and people. Who benefits if Ukip is finished? It’s likely to be the Tories. 

Is Ukip finished? 

What are Ukip's poll ratings?

Ukip’s poll ratings peaked in June 2016 at 16 per cent. Since the leave campaign’s success, that has steadily declined so that Ukip is going into the 2017 general election on 4 per cent, according to the latest polls. If the polls can be trusted, that’s a serious collapse.

Can Ukip get anymore MPs?

In the 2015 general election Ukip contested nearly every seat and got 13 per cent of the vote, making it the third biggest party (although is only returned one MP). Now Ukip is reportedly struggling to find candidates and could stand in as few as 100 seats. Ukip leader Paul Nuttall will stand in Boston and Skegness, but both ex-leader Nigel Farage and donor Arron Banks have ruled themselves out of running this time.

How many members does Ukip have?

Ukip’s membership declined from 45,994 at the 2015 general election to 39,000 in 2016. That’s a worrying sign for any political party, which relies on grassroots memberships to put in the campaigning legwork.

What does Ukip's decline mean for Labour and the Conservatives? 

The rise of Ukip took votes from both the Conservatives and Labour, with a nationalist message that appealed to disaffected voters from both right and left. But the decline of Ukip only seems to be helping the Conservatives. Stephen Bush has written about how in Wales voting Ukip seems to have been a gateway drug for traditional Labour voters who are now backing the mainstream right; so the voters Ukip took from the Conservatives are reverting to the Conservatives, and the ones they took from Labour are transferring to the Conservatives too.

Ukip might be finished as an electoral force, but its influence on the rest of British politics will be felt for many years yet. 

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