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Business News

Households saving more on jobs worries

Britons saved the most for 15 years in 2012 amid worries over an uncertain jobs market, official figures showed yesterday.

Experts put the rise in the household saving ratio to 7.1 per cent, the highest since 1997, down to higher precautionary savings by families. "Households clearly remained in a cautious mood throughout the year," Markit's chief economist, Chris Williamson, said.

The UK's financial standing with the rest of the world is also deteriorating as a stubbornly large trade gap pushed the current account deficit to £57.7bn in 2012. As a share of GDP, 3.7 per cent, it is the highest since 1989.

Investec's chief economist, Philip Shaw, warned: "Barring another significant drop in the exchange rate it will become more and more difficult for the UK to get closer to a position of external balance."