Relatively subdued consumer spending, intense domestic and international competition, and high input costs continue to dampen ... the sector.

While the CBI survey indicated a marked softening in consumer spending following the relatively strong December performance, it nevertheless indicated a significantly stronger performance than that seen overall in recent months.

The MPC could remain on the sidelines for some months to come as it monitors the strength of consumer spending and the housing market, and also looks to see if high oil and energy prices are feeding through to have second round inflationary effects.

This confirms that late in 2005 there was still no evidence that pay was starting to be pushed up by recently higher consumer price inflation and increasing energy bills.

The consumer is the weak link in the European economic upturn story. We're past the worst, but it's hard to see a marked improvement in spending coming.

The markedly reduced mortgage equity withdrawal since its fourth-quarter 2003 peak has undoubtedly weighed down significantly on consumer spending since mid-2004.