The head of Diageo has warned that consumers are facing an “extraordinary environment”, as one of the world’s biggest drinks makers reported its first global drop in sales since 2020.
The company, which makes Smirnoff vodka, Casamigos tequila and Johnnie Walker whisky, expects the pressures on consumers to persist in the coming months, echoing a warning from fast-food chain McDonald’s on Monday.
“We are in a very extraordinary consumer environment,” said chief executive Debra Crew. “You do see persistent inflation that is really weighing on consumers and weighing on their wallets.”
The drinks industry was already facing a decline in demand from the peaksscaled during the pandemic, but Diageo’s grim outlook is likely to feed fears over the strains on consumers across major economies.
Shares in Diageo tumbled more than 9 per cent in early trading on Tuesday.
The concern from Diageo and McDonald's comes as investors are paying close attention to signals that consumers are showing signs of flagging.
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