(Bloomberg) --
U.K. households added a further 27 billion pounds ($35 billion) to their bank accounts in the fourth quarter, suggesting they have yet to begin dipping into the huge savings pile built up during the pandemic.
Excess saving, the amount deposited over and above levels seen in the equivalent period before the pandemic, now totals more than 190 billion pounds, official figures published Thursday show.
Britons spent more of their income at the end of last year to maintain living standards in the face of soaring prices. But there are no signs they are drawing on their cash reserves, which were accumulated when lockdowns limited opportunities to spend.
How well the economy holds up amid an unprecedented energy-price shock may depend on their willingness to do so, with inflation forecast to hit double digits this year and wage settlements lagging far behind.
In the meantime, households have a significant financial buffer. They still saved almost 7% of their disposable income at the end of 2021, well above the 5% pre-pandemic average.
Read more:
- U.K. Households Cut Back On Saving as Inflation Bites
- U.K. Economy Grew More Than Expected as Omicron Raged
- Eight in 10 U.K. Adults Report Rise in Cost of Living in March
©2022 Bloomberg L.P.
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