“In Quarter 1 (Jan to Mar) 2017, the households and NPISH saving ratio fell to 1.7% from 3.3% in Quarter 4 (Oct to Dec) 2016. This was the lowest quarterly saving ratio since comparable records began in Quarter 1 1963,” the report said.
The ONS pointed out that the saving ratio had been falling since the third quarter of 2015. The recent fall is explained by the increased taxes on income and wealth.
“Real households disposable income (RHDI) fell by 1.4% in Quarter 1 2017; this was due to a decrease in gross disposable income of 0.9% and an increase in the deflator of 0.5%,” the report said.
Last month the Bank of England lowered its forecast for economic growth in the United Kingdom in 2017 from 2 to 1.9 percent. The bank cited uncertainty ahead of the Brexit talks as one of the major risks for the country’s economy.