By Marcus Leach

Data released by the Bank of England (BoE) has shown that credit card lending in April recorded its biggest monthly contraction since August 2006.

Despite growth in loans and overdrafts repayments outstripped new borrowing by £118m.

With the economy struggling the data once again shows that families are taking a more cautious approach to debt in the current economic climate.

“There isn’t enough money sloshing around or changing hands fast enough," Graeme Leach, Chief Economist at the Institute of Directors (IoD), said.

"That’s the conclusion of the IoD about the latest broad money supply figures published by the Bank of England. The growth rate of the MPC’s preferred measure of broad money fell from 7.1 to 3.8 per cent in April.

"This is well below the 6-9 per cent range thought to be consistent with the inflation target. Consequently the latest money supply figures suggest two things. First, that inflationary pressure will continue to recede over the next year. Secondly, that a further expansion in quantitative easing is likely over the coming months."

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