UK consumer confidence falters ahead of budget
Lastly, the savings index was up four points to +27; this is two points higher than October 2023
UK consumer confidence has dropped to -21 in October, according to GfK’s long-running index.
The survey revealed that out of the five measures three declined and two rose compared with September’s announcement.
The index measuring changes in personal finances during the last year was down one point at -10. Meanwhile, the survey revealed that the forecast about personal finances was up one point at -2, which is six points higher than this time last year.
The measure for the general economic situation of the country during the last 12 months was down five points at -42. Expectations for the general economic situation over the next 12 months were down one point at -28; this is four points better than October 2023.
Additionally, the major purchase index increased two points to -21; this is 13 points higher than this month last year.
Lastly, the savings index was up four points to +27; this is two points higher than October 2023.
Neil Bellamy, consumer insights director, GfK, said: “Headline consumer confidence has recorded a big fall this month to -20, taking us back to a similar level seen at the beginning of this year. All five measures are down but there are major corrections in the outlook for our personal financial situation for the next 12 months (down nine points), our views on the general economy for the coming year (down 12 points), and the major purchase index (down ten points).
“These three measures are key forward-looking indicators so, despite stable inflation and the prospect of further cuts in the base interest rate, this is not encouraging news for the UK’s new government. Strong consumer confidence matters because it underpins economic growth and is a significant driver of shoppers’ willingness to spend. Following the withdrawal of the winter fuel payments, and clear warnings of further difficult decisions to come on tax, spending and welfare, consumers are nervously awaiting the Budget decisions on 30th October.”
