Whilst consumers seem reluctant to spend due to Brexit concerns, new data suggests that their spending power is continuing to rise.
The Asda Income Tracker shows family spending power was 5.9% (£12.05) a week higher in July than the previous year, only slightly below the 6.3% increase from June. Despite the slowdown, the growth rate was still the second highest since March this year.
Record high employment rates and healthy pay rises contributed to improved figure.
Kay Neufeld, Economist at Cebr, which compiles the data for Asda, said: “As the economy has started to stutter over the past few months, the latest Income Tracker will be welcome news for UK households. So far, the slowdown in output growth has not yet affected the labour market and working-age households in particular benefit from employers competing for the best talent through higher wages. Meanwhile, inflation is under control and close to the Bank of England’s target of 2%.
“Looking ahead, the volatility of the pound could potentially lead to higher inflation in the coming months. Until then, households can expect to benefit from further increases in their spending power.”
