The average UK household was £13 a week worse off in February, according to Asda’s monthly income tracker.
The average UK household was £13 a week worse off in February, according to Asda’s monthly income tracker.
Discretionary income for the average family stood at £131 a week, 9.2% less than a year earlier.
The fall was due to a sharp drop in earnings growth caused by a collapse in bonus payments and an increase in taxes.
Discretionary spending was also squeezed by a rise in prices, following a reverse of discounts offered during the January sales, and the ongoing effects of sterling depreciation raising the cost of imported goods.
Andy Bond, ASDA president and chief executive, said: “The continued weakening of the labour market and spike in inflation have pushed the income tracker to a new low. The cost of living is being pushed back up, in part, by the largest depreciation in sterling’s value since the early 1970s – making imported goods more expensive, and by some retailers pushing prices back up again after their January sales.
“Although later this year we expect lower commodity prices to filter through, the challenge for retailers is to keep prices permanently low for consumers, and not get hooked on short-term discounts.”
