The Deloitte Consumer Tracker Q4 2014 - Discretionary Spending Hits Three-Year High

The latest Deloitte Consumer Tracker shows that an improving labour market and falling inflation are having a pronounced effect on consumer spending behaviours.

In Q4 2014 fewer people suffered a reduction or a loss of income and more people said they had received a pay rise than a year ago. These factors, coupled with low inflation, are underpinning consumers' confidence in their level of disposable income, which remained stable for the third consecutive quarter.

With the Consumer Price Index continuing to fall, reaching its lowest in 14 years in December, disinflation is providing a strong boost to consumers' finances. The Tracker shows that falling prices for essentials, including food, energy and petrol, are freeing more disposable income for discretionary and big ticket purchases.