Consumer spending ‘to fall 1.5%’

EMPLOYERS group IBEC expects consumer spending to fall 1.5% this year, as it downgrades it expectations for the economy.

It said higher than expected inflation, continued labour market weakness and ECB interest rate increases are the main reasons for the downward revision.

IBEC’s GDP growth forecast is down from 1.7% to 1.3%, while it said GNP will remain largely flat. It said inflation and interest rate increases will erode real disposable incomes.