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WHAT IS THE OUTLOOK FOR RETAIL SALES AND CONSUMER SPENDING?

<strong>VICKY REDWOOD </strong> CAPITAL ECONOMICS<br />"It was always likely there would be some fall in like-for-like retail sales in May after the boost from Easter dropped out. Factors impacting spending, particularly a weaker labour market, are taking effect and high street spending, which has been surprisingly resilient so far, is easing back in line with overall consumer spending."<br /><br /><strong>JAMES KNIGHTLEY </strong> ING FINANCIAL MARKETS<br />"Retail sales figures are likely to remain choppy for some time. While confidence is improving, there are concerns that subdued earnings growth and rising unemployment could provide headwinds for spending in coming months. Access to credit remains a major issue and households are also looking to pay down debt and save."<br /><br /><strong>HOWARD ARCHER </strong> IHS GLOBAL INSIGHT<br />"The problem remains that consumers are under serious pressure from rising unemployment, markedly reduced earnings growth and heightened debt levels, and many are keen to retrench due to concerns about the economy and jobs. We expect the savings ratio to rise significantly further, thereby limiting consumer spending."