According to a recent study, it appears that young people are upholding the economy. They are hopeful about jobs and it was their spending that assisted in maintaining robust consumer confidence in the final three months of 2016.
Spending on essentials such as discretionary items and groceries including eating out increased as a surge in confidence among the 18-34 age group rose to a peak since advisory company Deloitte started its quarterly consumer tracker.
The Bank of England is considering upgrading growth forecasts for the second time in three months as the UK economy continues to soar despite predictions that Brexit would slow it down.
HSBC analysts say that the Bank is forecasting growth at a 1.7% increase, a 1.4% growth since November.
Forecasters are confused by the resilience of the British economy. The prediction was that the economy would fall into a recession after the shock results of the EU referendum in last June. Economists are still predicting that this year will witness a slowdown and inflation will kick in due to a drop in the value of the pound against the euro and the dollar.
Mark Charney, governor for the bank has indicated that he may raise growth forecasts, but stated that growth has been pushed by consumer spending and so there is still a possibility that it will be slower and less likely to last.
According to Deloitte spending on non essential items is likely to drop over the next three months as the cost of every day basics and food continues to increase.
Fears about spending were also encouraged by a 2% reduction in confidence about disposable income in the last quarter of 2016.
The less optimistic are within the 35-55 and over 55 age bracket.
Chief economist for Deloitte, Ian Stewart has said: “At this point consumers don’t seem to be worried about Brexit. An increase in wages, high employment and credit growth have increased have kept consumer levels stable.”