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The £180bn question: are consumers ready to splash the cash?

The Office for Budget Responsibility expects houshold savings to reach £180bn by mid-2021. Economic recovery depends on how much of that will be spent after lockdown

By Paul Wallace  

The Bank of England's chief economist Andy Haldane has said people will be "desperate" to catch up on their social lives after the pandemic. Photo: PA Images / Alamy Stock Photo

Rishi Sunak’s second budget was a fiscal landmark, announcing the biggest tax rises in a generation. That diverted attention away from the accompanying economic projections from the Office for Budget Responsibility, even though these were remarkable in themselves. In particular, the OBR’s central forecast portrays a rapid recovery in GDP driven by resurgent household consumption. Will this happen? Indeed, could the rebound be stronger still if consumers spend even more than the fiscal watchdog expects?

Despite the rapid vaccination programme, the overall scoresheet on Britain’s performance during the pandemic has been dire: not only in terms of public…

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