British consumer spending growth hits 6-year low in 2018

Source: Xinhua | 2019-06-25

British consumer spending growth dropped to 1.8 percent in 2018, compared with the previous year, hitting the lowest point since 2012, according to a report released Monday by EY ITEM Club, a British economic forecasting group.
The latest EY ITEM Club Special Report on Consumer Spending forecast that the consumer spending will grow by 1.6 percent in 2019 over last year.
Meanwhile, it forecast that British GDP will grow by 1.3 percent in 2019 and 1.5 percent in 2020.
EY ITEM Club said that "although consumer spending growth slowed to a six-year low of 1.8 percent in 2018, this was stronger performance than the forecast in the 2018 EY ITEM Club Special Report on Consumer Spending."
The group stated that "British consumer spending was relatively unaffected by Brexit uncertainty, but slowing labour market and earnings growth could bite."
The group predicted that the growth in households' real disposable income was expected to be slower in the next two years, and was likely to be greatly below the post-war average.
Howard Archer, chief economic advisor with EY ITEM Club, said that "the improvement in purchasing power has meant that consumers have been significantly less affected in their spending decisions than businesses by uncertainties over the economy and Brexit."
"While consumer confidence in late 2018/early 2019 weakened to the lowest level since mid-2013, perceptions of personal finances and a willingness to spend generally held up much better than views of the economy," Archer added.