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Brexit chips away at consumer confidence

As opposition is growing at home, Theresa May is seeking support yet again in... Europe.

Research from the British Retail Consortium (BRC) will show growth in UK retail sales slowed dramatically to 0.6 per cent in the first quarter of 2019 compared to 1.8 per cent a year earlier. The decrease in retail sales flies in the face of a healthy labour market, with the unemployment rate at a record low and wages outstripping inflation. BRC Chief Executive Helen Dickinson said, “Retail sales slowed in March as greater uncertainty caused people to hold off from splashing out.”

If the trend continues, it could have long-term effects on UK growth and a negative impact on the Pound. A reduction in consumer spend is often an early warning sign of an impending recession as consumers put the breaks on the wheels of the economy.

Meanwhile, Theresa May could have some doubts over whether or not her request for a Brexit extension until 30 June will be agreed to. The UK prime minister is set to meet with Angela Merkel in Berlin and Emmanuel Macron in Paris today in last-ditch attempts to win their support ahead of the emergency EU summit tomorrow, 10 April.

Also tomorrow, we are expecting the next top-tier data release from the European Central Bank (ECB) that is due to announce its latest interest rate decision. Until then, Brexit will continue to steal the limelight.

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