U.K. consumer credit slows sharply in Dec, annual rate of borrowing posts biggest slowdown since Dec 2013

The Bank of England's data released today showed U.K. consumer credit grew by 1 billion pounds ($1.25 billion) in December. It was the smallest increase since mid-2015 and was significantly below analysts' expectations of 1.7 billion pounds forecast in a Reuters poll.

The annual growth rate in borrowing showed the first fall since July. On an annual basis, credit growth slowed to 10.6 percent from 10.8 percent in November, the biggest slowdown since December 2013. Credit card borrowing slowed even more sharply to show an increase of 228 million pounds, the smallest increase since October 2015.

U.K. consumers slowed the pace of their borrowing in December for the first time in five months, signaling that British shoppers may have grown more cautious on spending amid rising inflation.

Spending by households helped Britain rack up the fastest economic growth in 2016. An abrupt slowdown in borrowing could hit the mainstay of the economy at a time when incomes are coming under pressure from accelerating inflation.