Week ahead: City eyes fresh borrowing figures for signs of spending slowdown

Investors will be keeping a close eye on fresh economic data this week for further signs of the cost of living crunch hitting spending.

A flurry of downbeat economic announcements and data last week did not derail the capital’s premier FTSE 100 index, which added over one per cent to reach 7,483.35 points by the end of the week.

Last week, fresh figures revealed inflation in the UK is running at a 30-year high of 6.2 per cent, while Britain’s fiscal watchdog said living standards will fall at the fastest rate since 1956 this year, weighing on economic growth.

Fresh consumer borrowing figures published by the Bank of England on Wednesday are likely to indicate households are taking on debt to maintain spending amid higher prices.

Analysts at Deutsche Bank think consumer credit lending will “bump up to £800m, as more households tap into credit to fund expenses, given the ongoing rise in price pressures”.

Weakening consumer confidence levels may deter households from taking on debt in the coming months.

Swelling costs are likely to hit Lloyds’ business barometer index released this week, while new figures from the British Retail Consortium on Wednesday will provide more evidence of the scale of inflationary pressure building in the economy.

On the corporate front, high street retailer Next leads the way, publishing finals on Wednesday. Last week, the firm signalled cost pressures driven by the Ukraine war and supply chain disruption will result in price hikes.

Daily Mirror and Daily Express publisher Reach updates markets on Thursday.