High living costs hit household savings
The amount households have left to save fell in the first three months of the year as price rises outstripped wage growth, official data has revealed.
The savings ratio - the money left after consumption - fell from 5.1% to 4.6% over the quarter to March, highlighting the impact inflation is having on households and their finances, the Office of National Statistics (ONS) said.
The ONS, which left its estimate for growth in the UK's economy in the first quarter unchanged at 0.5%, said household disposable income fell in real terms by 0.8% in the three months following a fall of 0.9% in the previous quarter.
The amount of money people spent went up by 1.4% in the quarter, but adjusting for the increase in prices, real expenditure fell by 0.6%.
The ONS said that while the overall growth in the economy was unchanged, it revised up the contribution from construction but reduced industrial production, which saw its first fall since the third quarter of 2009.
Growth in the UK economy over the past four quarters was lowered to 1.6% from 1.8%.