The reluctant British consumer is a problem for Keir Starmer

For British consumers still reeling from Labour’s first budget, the watchword is caution.

Pessimism is rife and households are looking to cut their expenses, for example by eating in rather than dining out, figures last week showed. Inflation is resurgent and fear of job losses mounting. Gone too are the so-called excess savings built up during the pandemic, the victim of the savage increase in prices since then.

It’s a bleak picture for Prime Minister Keir Starmer and his Labour government, which swept to power in July promising to raise living standards. Instead, the economy is smaller on a per-capita basis and Labour is sliding in opinion polls. Alarm bells are also ringing at the Bank of England, where two policymakers this month called for interest rates to be slashed by a bumper half percentage point.