Next pulled a rabbit out of the hat on 19 June when it said sales had been much better than expected in the first seven weeks of the year. Since then sales growth has remained robust with Next ending the first half strongly. The group’s end-of-season sale also went better than expected which has led to a modest increase to full year profit guidance.

Despite this excellent first half performance, Next remains cautious and is expecting sales to be broadly flat in the second half, a material slowdown. This probably reflects a degree of conservatism from the group. It also likely reflects the recent rapid increase in interest rates which could be set to bite harder in the second half, sapping consumer confidence.

So far, 2023 has not been anywhere near as bad as expected for the UK consumer, and this has benefitted Next and its peers. The big question is – how much longer can this last? Recent signs that inflation is moderating offers hope for the economy, but the longer interest rates stay above 5% the greater the likely squeeze on disposable incomes.