(Bloomberg) — British consumers have cut back on Christmas gift-giving after the tightest cost-of-living squeeze in memory reduced disposable income, official figures showed.
Six in 10 adults in the UK surveyed said they were planning on cutting spending in the holiday period by buying fewer and less expensive presents and eating out less, the Office for National Statistics said Friday.
Household incomes are being hit by the biggest jump in prices in four decades. Inflation reached 11.1% in October, more than five times the Bank of England’s target.
The central bank has raised its key rate nine times over the past year to tame inflation, piling further pressure on people’s disposable incomes by lifting the cost of mortgages.
In the survey finished in mid-December, the ONS said about 18% of people reported they had no savings to cushion rising costs, and 7% said they had missed a payment on a bill in the past month.
Energy bills, rent and mortgage payments were among the most commonly reported financial pressures. Almost half of UK adults said they found it difficult to afford to heat their homes, and a third were struggling with rising rents or mortgages.
Anxiety levels were high among the British public in December, the ONS said. Three quarters of people were worried about the cost of living. By comparison, climate change and the environment dropped down people’s list of concerns, eclipsed by worries around the economy, inflation, and the National Health Service.