LONDON (Reuters) - British consumer spending growth is slowing in the face of a marked pick-up in inflation, while businesses are showing no sign of raising pay faster than before, the Bank of England said on Wednesday.
Sterling’s fall after last year’s Brexit vote is pushing up prices, according to the BoE’s latest regional agents report, which paints a broadly similar picture to that presented in the central bank’s quarterly forecasts last week.
“Consumer goods price inflation had picked up markedly. That largely reflected the effects of sterling’s earlier fall feeding through supply chains and into retail prices,” the BoE said.
Business investment intentions edged higher and pointed to a modest growth in spending, but firms showed little sign of raising annual pay awards above the 2.0-2.5 percent level that has been typical in recent quarters.
Reporting by David Milliken, Editing by Paul Sandle