Consumer confidence has seen its biggest month-on-month drop in more than three years as households contended with surging mortgage and rental costs, and higher petrol prices.
GfK’s long-running Consumer Confidence Index decreased nine points to -30 in October, with all five measures down in comparison to last month’s announcement:
The reading marked the largest monthly drop since March 2020, when the government first introduced strict Covid-19 curbs. It also reversed improvements in consumer confidence in August and September.
Joe Staton, Client Strategy Director, GfK, suggested that the sharp fall underlined that the cost of living crisis was continuing, with many people simply not having enough money to make ends meet.
He added: “The fierce headwinds of meeting the accelerating costs of heating our homes, filling our petrol tanks, coping with surging mortgage and rental rates, a slowing jobs market and now the uncertainties posed by conflict in the Middle East, are all contributing to this growing unease.”
He noted that the timing of the sharp drop in the major purchase measure – down 14 points – will concern retailers in the run-up to Christmas. “The volatility we are seeing in consumer confidence is a sure sign of a depressed economic mood, and there’s no immediate prospect of any improvement,” Staton concluded.
NAM Implications:
- “The fierce headwinds of meeting the accelerating costs of heating our homes, filling our petrol tanks, coping with surging mortgage and rental rates, a slowing jobs market and now the uncertainties posed by conflict in the Middle East, are all contributing to this growing unease.”
- What do we expect, given the scale of these unprecedented pressures on consumers?
- A disappointing Christmas will be one of the least impacts of Lockdown fallout.
- We should be more concerned about the loss of trust (in everything)…
- …as the biggest casualty of Lockdown fallout.
