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The US will increase spending, Europe will hold back amid the cost of living crisis

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Many shoppers say they plan to spend less this Black Friday due to the cost of living crisis.

Richard Baker | In pictures | Getty Images

Black Friday may offer bargains ahead of the festive period, but many shoppers will expect retailers to cut prices by higher margins this year as they tighten their belts amid a worsening cost-of-living crisis.

Shoppers in Europe plan to spend nearly one-fifth less during the annual discount period as inflationary pressures weigh on consumer sentiment, according to reports. research from the Boston Consulting Group this month.

UK consumers are set to cut spending by the biggest margin in the region, spending 18% less, while consumers in France and Germany plan to cut their spending by 15% and Spain by 13%.

American consumers were alone in a survey of nine countries, including Australia, that said they planned to spend more this year, increasing their spending by 6%.

Retailers under pressure

These findings come amid a worsening global economic outlook, particularly in Europe, where Russia’s invasion of Ukraine has affected growth and caused a sharp rise in energy prices.

The UK is already in recessionthe independent Budget Office of the country confirmed last week.

That adds pressure on retailers, which are already struggling to recover from the Covid-19 slowdown and attract increasingly thrifty shoppers. Meanwhile, many companies, in an effort to correct shortages and supply problems of the past year, have accumulated huge inventories that are now being forced to change.

What we have seen is the spread of the Black Friday trend.

Christy Morris

managing director of commercial solutions at Barclays Payments

“Black Friday is a vital time in the shopping calendar for brick-and-mortar and online retailers, which are still recovering from the Covid pandemic and now face consumers in many markets scaling back their spending plans on many non-essential items,” Jessica Distler, Managing Director BCG and partner, the report said.

This could lead to retailers extending their discounts throughout the month, increasing shopping opportunities for cash-strapped consumers.

The risk of fraud with purchases is growing

Transactions in the UK rose by 3.8% year-on-year in the week leading up to Black Friday, according to new figures from Barclays Payments, one of the country’s leading payment processors.

Christy Morris, managing director of commercial solutions at Barclays Payments, told CNBC on Thursday that this could mean shoppers are more likely to spread their shopping over the Christmas season.

“What we’ve seen is the spread of the Black Friday trend. We’ve seen it spread throughout the week and even further into the month,” Morris said.

“Part of this has to do with the potential for Christmas shopping and consumers thinking about being more savvy in how they spend over Christmas,” she added.

Nevertheless, experts urge buyers to be careful when trying to take advantage of discounts during the holiday season.

John Davies, UK and Ireland director at cyber security organization Sans Institute, said online hackers are known to “turn up the heat” during discount periods, especially when shoppers are under pressure to get a deal.

Indeed, after last year’s Black Friday and Cyber ​​Monday weekend, shopping fraud increased by 34%, according to Barclays research.

“Cybercriminals are leveling their attacks, which are becoming more widespread, more sophisticated and harder to detect than ever before,” he said.

Davies urged consumers to exercise extra caution when shopping online and not to make hasty or panicked decisions due to “fear of missing out”.

“Opportunistic hackers will try to create a false sense of urgency, so it’s important to exercise caution by not trusting scams, trusting your instincts and building security into all of our online behavior,” he added.

Retailers are

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