The Standard's business editor, Jonathan Prynn, recently warned hospitality businesses not to be over optimistic about Christmas the year.
Last year took many by surprise when, notwithstanding the best efforts of the rail unions, consumers embraced their first Christmas free of Covid restrictions since 2019 and spent like it was going out of fashion.
The great post-pandemic relief splurge extended well into the New Year with many hospitality businesses in London enjoying their best starts to the year on record. I suspect things will be very different this year.
For one thing more than one million mortgage holders will have been bumped onto far higher rates after their cheap deals expired. There will be hundreds of thousands more facing the same cut in disposable income in 2024, while others will already be reining in spending ahead of remortgaging pain in 2025 and beyond. Meanwhile rents are up by double digits in London.
A flash reading of the Composite PMI output index points to a small contraction in October, suggesting that the UK will be in or very close to recession by the time the big fellah clambers down the nations’ chimneys in two month’s time. Jeremy Hunt has already indicated he will be playing something of a Scrooge role when he unveils his Autumn Statement next month.
Christmas will happen, and for that we should all be grateful, just don’t set your sights too high with the wish list.
This article first appeared in The Standard on 25th October 2023.