STOCK MARKET WATCH - Tuesday, 31 January 2012

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35. Record drop in consumer credit, money supply {uk}

http://uk.reuters.com/article/2012/01/31/uk-britain-economy-credit-idUKTRE80U0HR20120131

(Reuters) - Credit card and other unsecured lending to British consumers posted its sharpest drop in nearly two decades in December, supporting expectations that the Bank of England will soon inject more cash into the economy to prevent a deep recession.

A steep decline in money supply also added to views that 75 billion pounds in quantitative easing, or asset purchasing, launched in October are not enough to boost the economy, which may have already entered a mild recession at the end of last year.

Consumer credit fell by 400 million pounds last month - the biggest monthly drop since records began in 1993, the bank said on Tuesday, confounding forecasts for a 400 million pound rise.

Weak consumer spending has been a major drag on Britain's economy, with consumers cutting back on purchases as the rise in living costs has outpaced meagre wage increases and fears of job losses weigh on confidence.