In today’s briefing:
- UK: Crushed Retail Will Hurt GDP
UK: Crushed Retail Will Hurt GDP
- In March, UK retail disappointed to a shocking extent as food and non-store sales plummeted. This profile is not just a healthy rotation back to pre-covid spending habits.
- Inflation demands more spending that isn’t affordable, so volumes get directly crushed while consumers get more cautious about the environment for major purchases.
- GDP is at risk of declining in March. We expect zero growth and maintain our below-consensus Q2 forecast for 0.3% q-o-q GDP growth. Inflation hurts real activity.
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