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"Rainy day" savings expected to grow, says bank
Consumers faced with a slowing economy in 2008 will start to squirrel away money for a "rainy day" and savings are expected to grow this year, according to Halifax.
The bank said that in a situation that is "almost the reverse" of what it should be, people will save in a slowing economy and spend with confidence when the financial system is more robust.
As the effects of the global credit crunch took effect last year, many people got an early start on their nest egg. The Buildings Society Association reported that its members had taken in £16.1 billion in new savings in 2007 - double the intake of 2006.
In December, the HBOS group predicted that individual savings accounts would be worth £240 billion this year.
Halifax spokesman Jason Clarke said when the economy is growing, people are confident in both their ability to spend and to repay debt.
"When things begin to slow down, people think 'now I need my rainy day money'," he added.
Halifax is part of the HBOS group, a UK company that provides international personal, corporate and business banking services.