Rising prices are Britons' biggest money worry as inflation stays high, survey finds

"Rising prices have become the top financial concern for UK households, according to a monthly consumer confidence survey, before Wednesday's official figures, which are likely to show inflation remaining stubbornly high. Amid fears of higher interest rates owing to increased fuel prices after the closure of the strait of Hormuz amid the conflict in the Middle East, households have become increasingly gloomy about their financial situation, the report said."

"The survey, from S&P Global, a data intelligence company, shows that its consumer sentiment index figure dropped to 42.1 in May, from 42.3 in April, the lowest level since July 2023 when inflation in the UK was soaring as a result of the Russian invasion of Ukraine. The index takes a combined figure tracking how people feel about their household spending, financial wellbeing, savings, debt and employment."

"The survey also showed Britons reporting a substantial decline in their household savings in May, falling at the fastest pace since July 2023. It said this was being driven by high energy prices and related costs which have significantly strained household budgets. Baluch said: Inflation worries have firmly taken centre stage. The rising cost of living is eating into savings at a rate not seen since 2011 if the pandemic is excluded, and is causing concern over future finances, in part due to growing conviction that interest rates are soon going to start rising."

"The survey of 1,500 people showed 51% anticipate a rise in interest rates, the highest proportion in two and a half years. Rate-setters at the Bank of England have suggested they will probably need to raise the cost of borrowing at some point this year if global oil prices remain high and push up inflation. The Bank has warned that ty"

Rising prices are the main financial concern for UK households, with consumer confidence weakening as inflation is expected to stay high. The consumer sentiment index fell to 42.1 in May from 42.3 in April, the lowest since July 2023. The index tracks household spending, financial wellbeing, savings, debt, and employment. Households reported a sharp decline in savings, driven by high energy prices and related costs that have strained budgets. Inflation worries have become central, with savings being eroded at a pace not seen since 2011 if the pandemic period is excluded. Many people expect interest rates to rise, and the Bank of England has indicated borrowing costs may need to increase if oil prices remain high and inflation pressures persist.

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