“Clearly many people will be struggling financially as a result of the pandemic, but cashflows will have improved considerably for many other households across the U.K. given they have been forced to spend less on travel, commuting and going out, and many will have used this opportunity to build up their savings and pay down their debts,” Amisha Chohan, equity research analyst at the investment management firm Quilter Cheviot, said.
The household savings ratio in Britain, which is the percentage of cash people save rather than spend, increased from 9.6% in the first quarter to 29.1% in the second quarter, according to the Office for National Statistics. This represented a record since the data began in 1987.
Data from the U.K.’s statistics office has shown consumers spent about £82 billion in November and December of 2019. But due to pent-up demand, the British Retail Consortium, a trade association, has said that sales will “outdo” those seen last year.