UK consumer and business confidence declines as Labour’s tax-raising budget sparks concerns over hiring, rising costs, and economic growth prospects.
UK consumers and businesses have grown more pessimistic about the state of the economy following Labour’s tax-raising budget, which has triggered concerns over hiring and escalating costs.
Recent surveys indicate a decline in confidence among British households and the vital services sector this month, undermining the government’s ambitions to permanently elevate economic growth to the highest in the G7 over the next five years.
According to the British Retail Consortium (BRC), a survey conducted this month found that more households are worried about the economy than before the budget announcement. The uncertainty has led households to maintain steady spending levels in November compared with October, despite the approach of Christmas, with only a marginal improvement in their personal financial situations post-budget.
In a separate survey assessing confidence among service-sector businesses—which constitute about three-quarters of the economy—there was the sharpest drop in optimism in two years over the three months to November, interrupting a nine-month trend of improving sentiment.
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