Investors dialling into corporate earnings calls are increasingly liable to hear the same worrying phrases again and again: "deterioration", "slowdown" and "pull back" were increasingly common between April and June, according to analysis of more than 700 transcripts by Barclays.
More often than not, executives' concerns trace back to how much consumers can afford to spend as inflation soars to 40-year highs. Fears are particularly acute in Britain, where people buying everything from Spotify subscriptions to meals out and new shoes accounts for around two thirds of UK GDP.
Official data on Friday showed the economy shrank 0.1pc in the three months to June compared with the previous quarter, when GDP grew by 0.8pc.
It has led to renewed fears that a squeeze on consumer spending will push the UK into recession, with inflation set to climb even higher as energy bills soar over winter.
The Bank of England says consumers are already cutting back. Many are trading down to cheaper brands or shopping at discounters like Lidl and Aldi. Households are increasingly repairing items rather than replacing them and many families are delaying buying big-ticket items like fridges and TVs.
Still, fears that we are already in recession may be overblown. The second quarter GDP decline was the first drop in more than a year, and a shallow one at that.
Much of the drag was a result of the winding down of the Government's test and trace and Covid vaccine drive, rather than a slowdown in consumer spending. An extra bank holiday for the Queen’s Platinum Jubilee celebrations also knocked growth.
A day out of work is a day not making money – in terms of measuring economic growth anyway – and that lost output isn't usually offset by money spent shopping and eating out. The economy shrank 0.6pc between May and June, in part reflecting the extra day off.
But the drag was considerably smaller than the 2.2pc fall seen for the Golden Jubilee in June 2002 and the 1.7pc drop for the Diamond Jubilee celebrations in June 2012.
After a long period of lockdown, many Brits seized on the chance to celebrate the Queen's 70 years of service. Mobile food stands and takeaways proved particularly popular, according to the ONS.
"At this stage, it’s impossible to tell whether this reflects a smaller-than-usual hit from the Jubilee, or evidence that the economy has considerable underlying momentum," says Samuel Tombs, Pantheon's chief UK economist.
In any case, an extra working day in the current quarter is expected to be the difference between growth and recession. The Bank of England now expects the economy to grow by 0.4pc in the third quarter, partly as Rishi Sunak's increases in National Insurance contributions are softened. In a partial about-turn, the former chancellor raised the threshold at which the contributions kick in, starting from July.
"If the UK is going into recession, then we don't think this is the start of it," says Elizabeth Martins at HSBC. "We still expect a bounce back in July to set the UK up for a positive third quarter."
Ms Martins highlights that consumers are still willing to spend, for now at least. In cash terms, households spent more money than they did in the previous quarter, even if they ultimately got less bang for their buck because of rising inflation.
"We see some signs of demand resilience here – or at least habit persistence: after all, consumption 'only' fell 0.2pc," she says.
"People still spent more money than they did in the first quarter, even if they got less for it. The June hospitality and recreation increases attest to that – even if the Jubilee weekend celebrations played a role."
However, consumer confidence remains fragile. Households built up a war chest of savings during the pandemic of around £180bn, according to Deutsche Bank. The fact that spending fell last quarter suggests people would rather sit on that cash than raid their savings. Many are worried about the future.
An even bigger concern is the substantial number of households with no savings at all. According to the Bank of England, the top 20pc of UK earners were twice as likely to have saved money during the pandemic than the bottom 40pc. With the average annual energy bill expected to soar above £3,500 a-year this autumn, the number of households with no savings is set to double to 5.3m by 2024, according to the National Institute of Economic and Social Research (NIESR).
Those at the sharp end will have no choice but to cut back on spending as energy bills eat up a larger and larger proportion of incomes.
David Bharier, head of research at the British Chambers of Commerce, warns that companies are also suffering from higher energy bills: “It is wiping out many firms' profit margins and threatening their long-term growth.”
The Confederation of British Industry says "pro-growth" policies are needed to secure the economic recovery.
Mr Bharier adds: “It is becoming critical for the Government to take action as soon as possible. The longer the economy is left to drift towards the danger zone, the harder it will be to rectify.”