Economy fears may increase debt worries

Mon, 21 May 2012

Fears about the state of the wider economy are likely to see worries increase among UK consumers.

Jatin Patel, director of current accounts for Lloyds TSB, noted more and more individuals are concerned by the situation, with income growth remaining weak and prices continuing to rise.

Mr Patel stated: "This will not have been aided by news suggesting that the UK has entered into a double-dip recession ."

The industry figure was speaking in response to new findings from the bank, which revealed spending power in the UK fell by 0.9 per cent in April when compared with that seen during the same month one year earlier.

It was also shown that real incomes tumbled 1.6 per cent over the same period, yet spending on essential items continued to climb rapidly.

Patrick Foley, chief economist at Lloyds TSB, explained household finances have carried on being stretched, even though the past seven months have seen significant falls in inflation.

He added weakness in the broader economy is likely to remain, which could spell bad news for those worried by the prospect of sliding further into debt .
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