Firstrung: Families trapped with falling income as mortgages rise

"We expect consumer spending to slow quite dramatically over the next year as consumers finally realise the reality of their financial situation, which is clearly shown by our index. There is still no sign, however, that this reality has sunk in with consumer spending rising at around 3% in the last quarter. The main reason why we think spending will falter is the pressure from mortgage payments and other outgoings that are not being matched by similar increases in real wages. There is some good news in our wealth analysis since house prices are still rising and equities are strong. These two factors are outweighing a worrying rise in debt and the wealth measure has moved into positive territory for the first time since the first quarter of last year."