The burden of debt management in the UK will continue to weigh heavy and impact consumer spending in the long-term, according to one expert.
Howard Archer, chief UK and European economist at Global Insight, is convinced that spiralling debt problems and higher interest rates will mean household finances will continue to feel the pressure over the coming months.
In response to figures from the Bank of England demonstrating that credit card borrowing levels increased last month, Mr Archer insisted that debt management will become increasingly important for consumers around the country.
“Going forward, heightened debt levels and higher interest rates mean that there is an increasing need for many consumers to do all that they can to improve their finances,” he said.
“We suspect that this will increasingly weigh down on consumer spending, along with a slowing housing market and muted real disposable income growth,” he added.
Interest rates have been increased five times since August of last year in the UK, putting added pressure on many of the country’s indebted households.