Growth in business activity is set to grind to a halt in the coming months as consumers rein in spending to cope with the cost of living crisis.
The Confederation of British Industry’s latest survey of members found the private sector is already treading water, with no improvement forecast.
Dark days: The Confederation of British Industry’s latest survey of members found the private sector is already treading water, with no improvement forecast
The responses suggested performance is mixed. Activity across business and professional services grew at a quicker pace than the previous month. But consumer services activity continued to fall.
‘Consumer spending isn’t going to restart the engine on growth this time,’ said CBI lead economist Alpesh Paleja.
‘With a further rise in the energy price cap now just weeks away, consumer-facing firms will also be bracing for an even tighter squeeze on household incomes in the months ahead.’
But she welcomed the recent discussion of the economy, saying: ‘It’s been encouraging to see both Prime Ministerial candidates, as well as the main opposition party, put the economy front and centre of political debate.’
