Consumer confidence in the UK has fallen back to the level last seen in March as households “hold their breath” about potential tax rises in next week’s Budget.
GfK’s Consumer Confidence Index fell one point to -21 in October, with three measures declining and two increasing compared to last month.
Whilst the figures highlight consumers’ concerns about the economy, on the plus side, the major purchase index rose two points and future personal financial expectations increased by one point ahead of the key Christmas trading period.
“As the Budget statement looms, consumers are in a despondent mood despite a fall in the headline rate of inflation,” said Neil Bellamy, Consumer Insights Director at GfK.
“This month’s Consumer Confidence Barometer paints a picture of people holding their breath to see what’s in store for them on 30th October.”
Separate data released yesterday showed that business confidence is also suffering, with the S&P Global flash UK PMI composite output index slipping to an 11-month low of 51.7 and companies cutting staff numbers for the first time in 2024.
Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said that “gloomy government rhetoric and uncertainty ahead of the Budget” had “dampened business confidence and spending”.
NAM Implications:
- We all know that ‘intent’ doesn’t always end up in the till…
- That said, any glimmer of encouragement helps.
- Meanwhile, the key is personal and business confidence…
- …are reflective of trust being the greatest casualty of Lockdown.
