Debt management contributes to record saving levels
Debt management contributes to record saving levels
- Wednesday, 23 December 2009Families are committing to debt management and achieving record saving levels in the face of an uncertain economy.
The average UK household saved 8.6 per cent of their income in the three months to September, the highest level for any quarter in over a decade according to the Office for National Statistics (ONS).
The figures also showed that consumer spending rose by 0.1 per cent in the third quarter - its first growth since the start of the recession, and still 3.3 per cent lower than the same quarter last year.
Yet economists have warned that a continued trend of household saving and halted consumer spending would prolong the recession.
Commenting in the Times, economist at the Centre for Economic and Business Research Ben Read said the move towards saving had come too late.
"Everyone borrowed too much and they are now paying the price. People need to save more, and this will act as a drag on recovery."
The figures were released as the ONS revealed that the UK economy has shrunk by six per cent over the last 18 months contributing to the country's deepest recession since World War Two.

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