UK consumption recovery may be short-lived — Bloomberg

The British economy saw the fastest retail sales growth since the beginning of 2021 in the first quarter. According to the Office for National Statistics, the figure grew by 0.4% in March due to record sunny weather, as opposed to the expected decline of 0.4%. Retail sales rebounded 1.6% in the first quarter, signaling that the economy is recovering from last year’s weak growth.

However, Bloomberg experts emphasize that the long-awaited rebound in consumer spending may be short-lived. In April, higher taxes and increased electricity prices worsened household sentiment. Additionally, warnings about the resumption of high inflation due to US import tariffs negatively impact consumers' purchasing behavior.

The UK consumer confidence index fell four points to -23 in April, the lowest under the Labour government (since the summer of 2024). According to Capital Economics, such data suggests that households may be more restrained in their spending in the coming months.