Almost half of UK consumers spend three-quarters or more of their household income on bills and essentials, according to a recent item from the Independent.
Spending on essentials is increasing at its highest rate in nearly two years.
Owing to higher utility bills, rising petrol costs and increased spending on food and drink, February marked a 6 percent growth in the cost of living year on year.
Meanwhile, incomes dropped 0.5 percent after inflation.
“Households remain under real pressure. Any improvement in this situation will depend on lower inflation on essentials, as income growth is likely to remain weak in the short term,” says Lloyds TSB chief economist Patrick Foley.
He adds: “We would expect households to start seeing the benefit of lower inflation in the next few months, assuming oil prices don’t continue to rise sharply, and with an improvement in consumer sentiment and spending.”
Compared to last year, households have about £45 less to spend on non-essential items.
Vicky Shaw is a reporter with the Independent. Read her original article here.