This week Bank of England chief economist Huw Pill generated controversy when he said that to break the inflationary spiral people in the UK need to just accept they are poorer and stop pushing wages up. This may be a clear and sensible conclusion to a simple economic problem, but consumers see their falling purchasing power as more than a cold and rational exercise in economic theory. The strong stock market updates from consumer-facing firms show those with strong brands have been able to protect their profits by passing on price hikes in full. This is good news for investors, but when consumers think they are the only ones being asked to shoulder the burden of rising prices the argument put forward by Pill was never going to be well received.
Meanwhile, despite weak consumer confidence, a slowing US economy was propped up by consumer spending remaining robust. Service activity has grown strongly in developed economies but headwinds from rising interest rates and tighter bank lending will further test consumer resilience.
Read what the team at Financial Express consider to be significant over the current week.