By Jason Douglas
LONDON--Britain's recent economic strength may not last, the Bank of England's chief economist said Thursday, citing a likely slowdown in consumer spending as accelerating inflation starts to bite.
Andrew Haldane said in a talk at the Institute for Government, a nonpartisan think tank in London, that a pickup in inflation fueled by a falling pound will likely cause households to "throttle back" on spending after a bumper year for retail in 2016.
"There are reasonable grounds for thinking that this year might be a somewhat more different year for the consumer than was last year," he said.
Mr. Haldane was speaking after a survey showed the U.K.'s powerhouse services sector expandedin December at the fastest pace in more than a year, a sign growth remained healthy during the final quarter of 2016.
He added that the outcome of coming divorce talks between the European Union and the U.K. following June's Brexit vote are "unknowable."
That "cloud of uncertainty" may begin to weigh on the economy if businesses delay investment, he said.
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(END) Dow Jones Newswires
January 05, 2017 09:06 ET (14:06 GMT)
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