UK households run down savings to record low

London: British households ran down their savings to a record low in late 2016 as they sought to offset a fall in their spending power, a warning sign for the country's economy this year.
In another indication that the economy has lost some of the resilience to the Brexit shock, official data showed the country's dominant services industry contracted in January for the first time since March last year.
The Office for National Statistics confirmed gross domestic product grew by 0.7 per cent in the October-December period compared with the previous three months, in line with a Reuters poll of economists.
But compared with the fourth quarter of 2015, growth was lowered slightly to 1.9 per cent from a previous estimate of 2.0 per cent.
Britain's economy last year defied forecasts that it would slow sharply after the referendum decision in June to take the country out of the European Union.
But a steep rise in inflation, caused in part by the fall in the value of the pound since the Brexit vote, is expected to crimp spending by consumers, who are the main drivers of the economy.
Friday's data showed real household disposable income — which includes wages and welfare benefits minus taxes and the impact of inflation, among other factors — shrank by 0.4 per cent in the October-December period of last year compared with the previous three months, the steepest drop in nearly three years.
The savings ratio sank to 3.3 per cent, its lowest level since records began in 1963, the ONS said.