Household finances are on the slide, as high inflation and unfavourable job market conditions continue to bite.
Markit’s Household Finance Index – a survey of 1,500 individuals in Great Britain that compares households’ finances monthly – dropped to a 20-month low in January.
Around 34% of households reported a deterioration in their current finances, compared to just 6% that saw an improvement.
This month’s survey also reveals a sharp rise in the number of households expecting their finances to worsen over the next year. And, predictably, the willingness to make major purchases has slumped to a survey record low (the HFI survey was first carried out in February 2009).
Inflation perceptions have jumped to a new high, and the cash available to spend is falling at fastest rate since May 2009.