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Financial pressures in UK ease amid sustained low inflation

Staff writer |
Rising from 43.9 in January to 45.3, the seasonally adjusted Markit UK Household Finance Index (HFI) was consistent with a relatively muted squeeze on finances during February.

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Though still signalling a downturn, the latest reading was one of the highest since the series began in 2009.

Out of the eight job sectors monitored by the survey, two registered outright improvements in financial wellbeing. Construction workers gave the brightest assessment, followed by finance/business services.

Among those that saw their financial situation worsen, education/health/social services employees were the most downbeat.

By region, the increase in the headline index was partly driven by relative improvements across much of the south of England. The South West, London and the South East all recorded historically weak pressure on finances.

A key factor leading to lower pressure on financial wellbeing was relatively subdued inflation perceptions in February.

Moreover, with workplace activity rising at a sharper pace and income from employment still growing, labour market conditions appeared to have strengthened since January.

However, worries about job security persisted, while savings and cash available to spend dropped further, which acted as a drag on household finances.

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