Slowing inflation still not enough to provide relief for UK consumers
Q1 consumer spending data has been abysmal in the UK
This morning's Visa data underscores that headline. It's something that I've been talking about for months now, the last of which was last month here.
For all the optimism surrounding last month's UK data - where wages were solid and inflation continues to show signs that it has reached its peak at the end of last year - it is not translating to the UK economy just yet.
More specifically, consumers are still feeling the pinch.
If the data continues to roll out in the same manner as we paddle through Q2, it's hard to see how much more weather-related excuses can be given when the signs here are blatantly obvious for any one to see.
The issue here is that sterling traders continue to look for a rate hike in May by the BOE - which has helped to push the currency higher, and that Brexit rhetoric has been quiet in April so far. But the real question should be what happens after when the BOE has to navigate through a flagging economy?
They are certainly hoping that wages will continue to deliver the rise needed to boost UK household spending as inflation starts to wane a little. And we'll get a taste of that this week, with UK jobs report data due tomorrow followed by the inflation report due on Wednesday.