Howard Archer, chief UK and European economist for Global Insight, believes that Britons are to have limited spending power over the next year.
“This is due to the major headwinds that consumers face – higher interest rates, elevated utility bills, moderate real earnings growth, an increasing tax burden, rising debt levels and pension concerns,” he said
Mr Archer’s comments come despite the fact that spending in the high streets this year was much higher than expected, with British shoppers leading to a 4.4 per cent year-on-year improvement in sales, according to research from the British Retail Consortium.
Heavy price discounting is thought to have contributed to the retailers’ performances over the Christmas period.
The increased spending, both over Christmas and in January, has meant that many consumers have had to seek help in managing their debts.
Lesley-Ann Walsh, debt advisor at Citizens Advice, told the Carlisle News & Star that those concerned about their debts should seek professional help immediately.