Household borrowing in the UK fell in December and January, signalling the first hints at an economic slowdown after the Brexit vote, a report by Standard & Poor’s has shown.
The credit ratings agency reported that the flow of consumer credit had slowed compared with earlier in the year. Unsecured household lending totalled £1bn in December and £1.4bn in January, compared with an average of £1.6bn in the 11 months to November 2016.
Boris Glass, senior economist at Standard & Poor’s, warned that the drop could represent a slowdown in the economic momentum that was fuelled by consumer credit after the Brexit vote, The Times has reported.
He said: “In our view, this is a sign that the consumer spending spree that almost entirely drove GDP growth in 2016 is likely to have started to cool.”
Glass described the results as “the first sign of the gradual slowing of the economy that we expect for 2017”, and warned that low interest rates would not be able to offset the impact of “Brexit-related uncertainty”.
However, the report noted that credit supply conditions in the UK remain “relatively favourable”.