UK consumer confidence hits new low in August - GfK

By

Nigel TAYLOR

Published
Sep 23, 2022

An already bruised consumer confidence took a further hit in September, tumbling to a new low, according to GfK’s long-running index. And with the Bank of England now suggesting the UK has tipped into recession, expect further dips to come.

In fact, GfK talked of “deep concerns about personal finances and the economy over next 12 months”  

The main Consumer Confidence Index fell five points in September to -49, the worst overall index score since records began in 1974. Meanwhile, four supporting measures were also down on August figures, and one was flat.

The index measuring changes in personal finances over the last 12 months fell three points to -28 and is now 24 points worse than September 2021. The forecast for personal finances over the next 12 months also dipped nine points to -40, a full 45 points lower than this time last year.

The measure for the general economic situation of the country during the last 12 months is down four points at -72, down 29 points on September 2021.  Expectations for the general economic situation over the coming 12 months have also deteriorated with an eight-point drop to -68, now 52 points lower than September 2021.

The Major Purchase Index at least remained unchanged this month at -38, but it's still 32 points lower than this month last year.

Finally, the Savings Index is down seven points this month at +11, now 11 points lower than this time last year.

Joe Staton, Client Strategy Director, said: “Especially worrying are the two key future-facing indicators on personal finances in the coming year and the economy in the next 12 months.These numbers are where many forecasters look for signs of economic optimism among consumers and the results deliver very bad news in that respect."

Staton added: “Consumers are buckling under the pressure of the UK’s growing cost-of-living crisis driven by rapidly rising food prices, domestic fuel bills and mortgage payments. They are asking themselves when and how the situation will improve. Today’s mini-budget, and the longer-term agenda to drive the economy and help rebalance household finances, will be the first major opportunity to deliver that improvement. It will also be a major test for the popularity of Liz Truss’s new government.”