UK | Buoyant consumers fuel a strong recovery

Retail sales surged in March, even though many physical stores remained closed, while the reopening of non-essential stores and outdoor hospitality in England on April 12 appears to have generated a surge in spending over the past couple of weeks. The strength of this reaction to restrictions being relaxed adds credence to our above-consensus forecast for GDP growth. And there is still little evidence that the recovery is likely to be thrown off course by either a spike in unemployment or a sustained pickup in inflation.

What you will learn from this report:

• Retail sales rose back above their pre-pandemic level in March.
• Consumers have reacted positively to increased opportunities for social consumption.
• We think it’s unlikely the consumer recovery will be derailed by surging unemployment or inflation.