Britain on track for record economic growth in Q3

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Britain on track for record economic growth in Q3
Economists believe any short-term gains will be difficult to sustain with continued social distancing measures and a possible second wave of infections.
// Consumer spending in August rose 7% year-on-year
// ONS figures find spending rose 3.6% from June to July
// Long term recovery likely to be closely linked to social distancing restrictions and concern over a seocnd wave of coronavirus

New data suggests Britons may be ready to spend once again after months of lockdown.

Figures from Fable Data cited by the Financial Times said total spending (including leisure) in the first two weeks of August exceeded the same period a year earlier.


READ MORE: Consumer confidence takes a hit as redundancies taint high street


This is the first time there has been annual growth in spending since the lockdown was introduced in March.

Fable Data said consumer spending in the first two weeks of August rose 7 per cent higher than during the same period one year earlier, according to information compiled across many different forms of electronic payment.

The results come despite the UK receiving the sharpest fall in gross domestic product in the second quarter compared wit the last three months of 2019 across any G7 nation.

However, forecasters also believe the recovery could be short-lived.

Pent-up consumer demand and the planned re-opening of schools may have boosted spending in August, but economists believe the reality of continued social distancing measures and a possible second wave of infections make any sustained growth difficult to predict.

The Office for National Statistics on Friday revealed retail sales grew 3.6 per cent from June to July, coming in 1.4 per cent higher than the year before.

More meals have been bought in pubs and restaurants due to the government’s “eat out to help out” discount scheme that runs through August, Fable Data analyst Avinash Srinivasan told the Financial Times.

“We have clearly seen an improvement [in total spending] over the past month,” he added.

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