British households are suffering the tightest squeeze on their finances since the middle of the recession, according to a new report. The Markit Household Finance Index found that 36% of households saw their financial position worsen in June compared to the previous month, as more people used their savings or took on further debt to counter the rising cost of living. This led to the Index’s barometer, which is intended to project future consumer behaviour, to drop to 35.1, its lowest level since March 2009. Tim Moore, senior economist at Markit, said: “This pours cold water on the tentative signs of improvement in May. Household finances are deteriorating at the fastest pace since early 2009. People are eroding their savings and taking on more debt to finances strong rise in living costs. And income from employment is continuing to fall.”