Published on June 30th, 2017 | by The GC Team0
Consumer confidence tumbles as concerns for year ahead intensify
A study covering the period before and after the UK general election has revealed a sharp drop in consumer confidence.
GfK’s Consumer Confidence Index decreased five points to -10 in June, just two points away from last year’s post-Referendum low of -12. Declines reflected negative sentiment about personal financial situations and expectations for the wider economy.
“Strong consumer spending has propped up the economy since last June but now the twin pressures of higher prices and sluggish wage growth are squeezing household finances and adding to widespread fears of a Brexit-induced economic slowdown,” said Joe Staton, Head of Market Dynamics at GfK.
Figures on the general economic situation looking forward and back 12 months are now particularly weak. The measure during the last 12 months decreased five points to -25 – 12 points lower than in June 2016 – while expectations for the next 12 months fell two points to -23 – nine points lower than in June last year.
The Major Purchase Index also fell, down eight points to +1 (eight points lower than in June 2016).
GfK’s Staton pointed out that consumer concern will worry UK retailers, highlighting in particular the “plunge” in the Major Purchase Index. He added that the fall reflected increased caution over non-food spending and a softening appetite for debt.