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Consumer credit is unsustainable – Tough times lie ahead for retail and services in the UK


There has been a boom in consumer credit in recent years, which has supported consumption as wages have been subdued and inflation has been rising. Although it may seem paradoxical, households in the UK have being increasing their consumption as their real income has been shrinking. Consumer credit has recorded the highest (double-digit) growth rates since the financial crisis of 2008, amid high consumer confidence and a low interest rate environment. Under these terms, the retail and services sector that have grown based on this credit spree are vulnerable in… Read more