UK households see green shoots of recovery as disposable income rises, points out Asda

The latest figures from Asda’s Income Tracker shows the financial pressures facing UK households eased slightly during last month, with a 4.5% increase in disposable incomes year-on-year - marking the strongest annual growth rate since September 2021.

In July, the amount households had to spend on themselves after paying taxes and essential bills, was up by £9.48 a week compared on the same period a year prior.

Compared with the previous month, disposable income picked up by £6.09 per week, taking the average disposable income to the highest it has been since March 2022 at £218 per week.

The improvement in household spending power was due to the easing of inflation down to 6.8% in July compared to 7.9% the previous month. This was predominantly due to lower energy prices, while lower food and non-alcoholic beverage prices also contributed to the monthly slowdown.

But despite these recent improvements, family disposable income remains firmly below the levels experienced prior to the cost-of-living crisis, down by £25.99 per week for the average household compared to July 2021.

There are also notable differences between households, with those aged 30-49 feeling the pinch the most as spending on essentials like food, housing costs and utility bills, was 9.4% higher in July compared to a year earlier. 

On average, these households spent £726 on essentials per week in July - £135 per week more than the average spend on essentials for all households.

In contrast, older households aged 65+ enjoyed a 7.8% increase in average disposable incomes in July compared to a year earlier. This reflects their stronger gross income growth following the recent uplift to the state pension and smaller rises in the cost of essentials.

Asda has pledged to continue to support families during the cost-of-living crisis by keeping prices under control and is monitoring the situation and launching new propositions to provide customers with more value every time they shop.

Asda won the Grocer 33 pricing award for the 26th consecutive year last month and has recently revealed it was cutting the prices of over 200 own-label lines by an average of nine percent. The products include a whole host of fresh fruit and vegetables, frozen meat and fish products, cupboard staples and popular ready meals, too.

Asda's also extended its immensely popular kids eat for £1 cafes offer until year's end of the year. It's served over two million meals to kids since it launched the initiative last June.

www.asda.com