Household savings could propel economy to pre-covid levels by mid-2022, says expert
A £200bn war chest of household savings could help propel the UK economy’s GDP back to pre-Covid levels by the middle of next year, according to one of the country’s leading economists.
Mark Berrisford-Smith, Head of Economics at HSBC UK Commercial Banking, believes that the Covid-19 vaccine will help to fuel strong economic growth over the coming year as key sectors such as hospitality, leisure and non-essential retail re-open to a confident consumer market.
Speaking at a webinar arranged by leading Midlands law firm Wright Hassall and HSBC UK, he also suggested that around one tenth of the £200bn worth of savings is likely to be spent on luxuries by the end of 2022, with the remainder of the money likely to fund debts such as lump sum payments on mortgages and credit card bills.
An active corporate landscape is also expected by Berrisford-Smith, which he says is likely to be driven by a rise in mergers and acquisitions as companies look to restructure, as well as foreign investment now that there is more certainty now the UK has left the EU.
Lucie Byron, from Wright Hassall, added: “This was one of our best-attended webinars with many business owners keen to understand from a well-respected economist how the economy may fare in the future, and how this could impact their own company.
“Hopefully Mark’s comments have encouraged businesses as they embark on their own recovery plans over the coming months.”
To watch a recording of the webinar click here.
