Spending power falls in 10 out of 12 UK regions

 
Helen Cahill
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Leading UK Supermarkets Compete For Their Share Of The Market In The Run Up To Christmas
Inflation has hit household budgets (Source: Getty)

Consumers were hit once again with a squeeze on household budgets last month, as spending power in the majority of the UK's regions fell.

The average household in the UK had £197 per week of discretionary income last month, down by £0.94 a week, according to Asda's income tracker.

Read more: Pound drops against dollar and euro as ONS reveals retail sales slump

In the third quarter, only households in London and Yorkshire benefited from a rise in discretionary income.

Income growth recovered from a weak second quarter, but a rise in the cost of essential goods cancelled out the rise in earnings.

Some of the main cost rises for families in September came from fuel (up 6.1 per cent) and food (up 3.0 per cent).

Kay Neufeld, economist at the Centre for Economics and Business Research, said: "We have seen family spending power decline in five out of the last six months, underlining the mounting pressures on households' budgets.

"The cost of essential spending has risen considerably since the beginning of the year and we expect that it will take a few more months until inflation slows down."

The data comes as the Confederation of British Industry's retail survey found retail sales experienced the sharpest fall since the height of the financial crisis in the year to October.

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