Falling Scottish GDP is deeply worrying for households

Kevin Brown, savings specialist at Scottish Friendly, comments on the latest monthly GDP figures for Scotland which show the economy fell by 0.5%

The latest monthly figures on Scottish GDP showing a 0.5% fall make for worrying reading. Falling GDP is a real threat to households’ prosperity at a time when costs are soaring across the Scottish economy.

Falling GDP is a real signal here that inflation is biting, and as a result curbing spending power. Scottish businesses and families are beginning to feel the pinch in earnest. This mixture of financial headwinds is affecting households across the income spectrum, with rising energy, food and motoring fuel costs hurting budgets the most

What is really important now, for those households able to maintain some level of monthly saving, is to keep contributing to short-term rainy-day funds to protect against unforeseen expenses. Longer term, Scottish savers cannot rely on cash savings alone as average rates, while rising slowly, are well behind inflation. Only through longer term investing and regular contributions will Scottish households give themselves the potential for greater returns.