Despite rising interest rates, consumers are set to continue borrowing and spending freely, according to analysts.
The Bank of England has gradually increased interest rates by a quarter-point since November in an attempt to alert consumers to the tightening of the economy.
However, this has had little effect on consumers who view the 4.5 percent rate as relatively low.
With debt set to reach the trillion pound mark in July, there are worries that the Bank of England should have increased rates further; but analysts fear any sudden movements could lead to the precise crash they are trying to avoid.
Speaking to the Reuters news agency, Mark Miller, economist at HBOS Treasury services, said: "As long as income generation and employment growth continues, consumer spending can be sustained. It's when rates get above 5.0 percent that you may see some bite."
Figures are expected to show that retail sales rose by 1 percent in May, due to the improved weather and the anticipation of the European football championship.
House prices also rose by 2.2 percent last month, signaling that consumers are not yet ready to curb their spending. |
