Data released today confirms that consumer confidence in the UK is continuing to weaken amid concerns around surging food prices and the UK’s economic struggles.
According to BRC-Opinium data, consumer expectations over the next three months of the state of the economy worsened to -36 in September, down from -32 in August. People’s outlook on their personal financial situation also worsened to -7, down from -6.
Their expectations on personal spending on retail rose slightly to +5, up from +4, although on personal spending overall, it fell from +16 to +14.
Helen Dickinson, Chief Executive of the British Retail Consortium (BRC), noted that confidence among Millennials (28-43) had fallen significantly this month after their expectations for both the economy and their own finances fell by double digits. “The same generation also cut spending expectations for the months ahead, though this was largely offset by improvements for Gen Z, who remain the most optimistic,” she said.
“Worries about the Budget, combined with the increase in the cost of living, have eroded confidence, with little sign that inflation will come down soon.”
Rising prices are now seen as one of the biggest concerns among the public, with analysts forecasting that food inflation will hit 6% by the end of the year as supermarkets and manufacturers pass on higher costs resulting from the hike in employer National Insurance Contributions, the new packaging tax, business rates rises, and the cost of border checks.
Dickinson concluded: “All eyes are now firmly locked on the 26 November, and what the Chancellor will announce. The Government can help mitigate inflation, improve the cost of living, and raise consumer confidence by ensuring the upcoming business rates reforms offer a meaningful reduction to retail business rates, while ensuring no shop pays more as a result.”
NAM Implications:
- The signs have been obvious for months…
- …to all but the government, apparently.
- Meanwhile, realists appreciate the inevitable impact on demand…
- …and are cutting to fit,
