Britons are going into debt at almost five times their earnings. Unsecured consumer borrowing is at an all time high since December of 2008. With the lowest interest rate in years,borrowers are encouraged to refinance mortgages and business loans. Spending is at its weakest rate in almost three years as the drop in value of the pound since the EU Referendum has prices rising . Although a slight upturn in July there are no indications that there will be a significant upward movement or economical growth.
Key Takeaways:
- As daily living standards mire in the UK, Brits are using their borrowing power, through loans, overdrafts, and other options, a bit less.
- The annual growth rate for consumer borrowing slowed in July, down to 9.8%, which shows the lowest rate of expansion since April of last year.
- Flaccid spending trends reflect the pound’s devaluing since the EU referendum, as well as negative earnings growth, demonstrative of the ratio between wage earnings and inflation.
“Weaker levels of growth in consumer credit could relieve pressure on the Bank to raise interest rates to slow the rapid expansion in the supply of money. Sluggish GDP growth and inflation coming close to its peak could put off a rate rise until late 2018, or even early 2019.”