The latest data on wages and inflation shows that people are slowly getting better off, with wages increasing by 6% and inflation remaining just above 3%. Additionally, the National Insurance cut initiated by Jeremy Hunt earlier this year is expected to ease financial burdens for those in employment. Despite these positive developments, retail data suggests that consumers are still hesitant to spend.
Several factors could be contributing to this reluctance, including unfavorable weather conditions and a lack of confidence in the economy. Additionally, the slow progression of remortgaging rates, which have been creeping closer to 5% after dropping to around 4% previously, may be causing people to prioritize replenishing household savings over discretionary spending.
To encourage increased consumer spending, there is a need for stability and a more optimistic outlook. Instead of dwelling on past challenges like the cost of living crisis, there is a call for more positive influences to drive economic activity. The prospect of England performing well in the Euros this summer is seen as a potential boost to national morale and could provide the spark needed to stimulate economic growth.
While it’s important not to put too much pressure on the England team, their success on the pitch could translate into a much-needed boost for the economy. By rallying behind the Three Lions and rooting for their success, there is hope that a good performance at the Euros could rejuvenate consumer confidence and lead to an uptick in spending. So come on England – your economy needs a win!