Consumption to drop as wages fail to keep up with inflation, report says

Real disposable income will take a big hit across western economies, the latest Global Report from Barclays says, but a global recession is unlikely despite the war in Ukraine

A busy Grafton Street in Dublin last week: inflation in the euro area is expected to range between 5.5 per cent and 7 per cent for most of this year, before edging lower in the final quarter of 2022. Picture: Fergal Phillips

Consumption will drag lower this year, as higher prices for energy and food squeeze real wages, according to the latest Global Output report from Barclays.

Europe is expected to be most impacted by this.

With inflation increasing, real wages across most of Europe are likely to decline “significantly” in 2022, according to a report from the bank.

Inflation in the euro area is expected to range between 5.5 per cent and 7 per cent for ...