Pressure is mounting on the government to deliver an emergency summer mini-budget after recession fears were heightened by a surprise contraction in the economy in March.
Evidence that the cost of living crisis was biting even before the arrival last month of dearer energy bills and higher taxes led to a sharp selloff in shares and a drop in the pound’s value to a two-year low against the US dollar.
The Labour party, the TUC and the British Chambers of Commerce all pressed for urgent action from the chancellor, Rishi Sunak, following the release of official figures showing a marked drop in consumer spending in March.
Boris Johnson pledged that the government would “do things” in the short term to ease the squeeze on living standards without providing any hint about what the measures might be. His pledge came amid growing speculation that the economy would fall into recession – two successive quarters of negative growth – over the coming months.