Having spoken with a sample of UK consumers Lloyds TSB can see how they are now feeling the pinch as the credit crunch and economic difficulties continue to affect lifestyles.
The view of the future is also seen rather negatively by those surveyed, with an expectation of inflation nudging the 3.8 percent mark in the next year. There were also worries about job security as they see costs spiralling for consumers and businesses. These views are part of the Lloyds TSB Consumer Barometer, where consumer views are reviewed on a monthly basis.
One of the biggest stresses facing the people of the UK are rising prices, with around nine out of ten people seeing prices up from the previous month. Roughly the same number expect to see this trend continue next month as well, further dampening their confidence in the future.
The Legal and General is reporting that economic indicators are flagging up a 95 percent chance of economic slowdown and subsequent recession.
According to an analyst at the company these indicators are even more pronounced than in 2001, the last time the UK economy fell upon hard times. This time the country is even more reliant on borrowing and the criteria for lending money is tighter than before. It has also been said that, even if access to credit becomes easier the startlingly fast rise in the price of fuel will keep the pressure on consumers and the economy.
The Legal and General analysts are factoring in the global slowdown that is needed, saying that countries such as the UK and USA will be hardest hit. All in all these look like trying times for the economy and consumers.
The May Fundamentals report produced by Legal and General suggests that the economic outlook for the UK is a negative one.
There are some positive factors said the Legal and General, such as low unemployment, the weaker pond helping exports and the fact that consumer spending is still active. However they see more negative elements than positive ones which leads them to rating the economic forecast as poor.
Key pointers include the much more difficult lending conditions facing borrowers, higher levels of debt and also a rate of inflation that is rising much too quickly. All in all the Legal and General view is that, unless changes are seen in this factors the UK economy could face real difficulties.
