Economic Briefing Report

British economy returns to growth, but the cost-of-living squeeze worsens

  • BRC author avatar
    Harvir Dhillon Economist
"The UK is set for a difficult period beyond the summer. Against a backdrop of higher fuel costs and heightening shop prices, the outlook for demand is weak into the Autumn and beyond. Indeed, early signs of weakness are apparent in the BRC’s retail sales figures.
Pass-through of costs is beginning to be seen in the BRC’s Shop Price Index, rising to record highs in July. We expect this will increase the likelihood that the Bank of England will pursue a further rate hike on the 4th of August. The higher borrowing costs entailed would weigh further on economic activity. Ahead, risks of a contraction in the UK economy are rising, particularly as we head into the Winter months."


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