BANK ACCOUNTS, CREDIT CARDS

UK falling into recession as retailers take the worst hit for three years

High streets up and down the country have suffered as a result of the worst slump in New Year sales that retailers have seen for three years.

According to the Confederation of British Insurers (CBI), high streets have recorded a fall in sales volumes by 22%. This the lowest level since March 2009. 

In a bid to boost sales following a decline over the autumn period, the majority of retailers reduced their prices in the run up to Christmas.

Once again, following the typical January sales, retailers have seen a fall in profits. They have also reported that orders are down.

Ian McCafferty, CBI Chief Economic Adviser, said; “Shoppers have reined-in spending across the board at the start of the New Year after taking advantage of early discounting last month, which boosted pre-Christmas sales. Consumers are still holding off particularly from buying big ticket items like washing machines and fridges.”

The rising cost of living is driving consumers away from shops as McCafferty pointed out; “Family budgets are under continuing pressure with inflation still high and wage increases modest.”

Credit cards

As the economy is putting pressure on consumers, many may be turning to credit cards. Recent research from price comparison website GoCompare.com suggested that 26% of Brits will rely on credit cards this month.

However, to avoid falling into debt it could be worth considering taking out a prepaid card.

They work much like a prepaid mobile phone top up card in terms of you putting money onto the card, meaning you cannot spend anymore than is on the card. Orange prepaid cards are widely available.

Tags: BANK ACCOUNTS, Confederation of British Insurers (CBI), CREDIT CARDS, family budget, uk economy, UK recession