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Business News: UK House Holds Financial Outlook

UK Households' Financial Outlook

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Pessimism among British households about their financial prospects hit a two-and-a-half-year high after last month's vote to leave the European Union, according to a survey that showed most expect the Bank of England will cut interest rates.
Markit's Household Finance Index also showed perceptions of workplace activity declined at the fastest rate since March 2011, while fears about job security rose to their highest level in nearly three years.
Overall, the survey added to signs that the June 23 vote to quit the EU delivered a hefty knock to business and consumer confidence over the coming year, which economists worry heralds a sharp slowdown or even a recession.
The gauge of household finances in the next 12 months fell to 47.0 in July from 49.3 in June, the lowest level since January 2014.
Income from employment rose at the fastest pace since the survey started in early 2009, the survey showed, which Markit linked to the introduction of a higher minimum wage in April.
Official wage data for the three months to May are also due on Wednesday, and are expected to show a 2.3 percent increase in average weekly earnings compared with the same period a year ago. ECONGB
Some 56 percent of respondents in the Markit survey said they expected the Bank of England to cut interest rates, far above a previous record of 10 percent set in March.
While the BoE unexpectedly left rates on hold at 0.5 percent this month, it signalled it would likely launch a package of measures to boost the economy in August. The Markit survey of 1,500 people was conducted between July 14 and July 18.

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