Consumer spending in the UK has experienced its fastest growth in nearly two years, according to recent reports by the BRC and Barclaycard. Retail sales rose by 2.6 percent in January, with a significant 2.7 percent increase in discretionary spending. This growth signifies a willingness among consumers to spend after recent wage increases. However, household savings rates remain high, showing lingering caution amidst economic uncertainty. Despite the growth, businesses may face challenges from rising costs due to wage increases and national insurance hikes, leading to potential price increases and reduced investment.
Many businesses will be left with little choice but to increase prices, and cut investment in jobs and stores.
The rise in consumer spending comes amid growing economic uncertainty.
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