Last year, consumer expenditure hit£1.09 trillion - up 9 per cent on the previous year. This compares with a 6 per cent growth in spend between 2004 and 2005.
Mintel senior retail analyst Neil Mason said: 'The clear message is that it takes a lot to dampen consumer confidence, because last year Brits continued to spend. Rising disposable income has lead to higher expectations about the quality of life and, as a result, we are increasingly trading up and spending more on better quality, premium products and services.'
The report said mounting interest rates and mixed messages about the housing market have as yet failed to dampen consumer spending on the high street. However, Mason added: 'A degree of caution is creeping into the consumer economy, which means we are likely to see a slower rate of growth in the medium term.'