Latest consumer confidence data adds to fears that UK retailers are set for a tough Christmas trading period.
Amid political and Brexit uncertainty, GfK’s long-running Consumer Confidence Index decreased two points to –14 in October. All five measures used to calculate the figure decreased:
Joe Staton, Client Strategy Director at GfK, said: “Importantly, the ongoing machinations in Westminster appear to be impacting how we view our personal financial situation for the coming year, with a fall of -3 in this measure in October. Is this an early sign of long-running weak economic confidence spreading to the way we view money matters?
“This deterioration in sentiment regarding our personal financial affairs is worrying as strong consumer spending has been the main driver of economic growth since the Referendum in 2016 against a backdrop of low inflation, low interest rates, low wage growth and high employment.
“Does reduced confidence in personal finances for the year ahead pose a risk to the wider economy? Nobody wants to see consumer spending reduce and let’s hope it doesn’t happen. But Brexit’s continuing uncertainty and the spectre of a general election is not helpful. People can only feel confident if they believe the external environment is stable, yet consumers are witnessing too many Brexit shifts and surprises, too many Brexit timelines and counter proposals to justify any longer-term confidence. The big black Brexit cloud is refusing to shift.”
