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Economy

UK consumer confidence decreases three points in August

GfK’s long-running Consumer Confidence Index decreased by three points to -14 in August.

The measure for the general economic situation of the country during the last 12 months decreased by two points in August month to -34, eight points lower compared with the same period last year, and expectations for the next 12 months have also decreased six points to -38.

The major purchase index decreased three points during the month to +1, five points lower than in August 2018.

Joe Staton, client strategy director at GfK, said: “Until Brexit leaves the front pages – whenever that will be – consumers can be forgiven for feeling nervous not just about the wider economy but also about their financial situation.

“That’s an important distinction because a significant development in August is the sudden drop in views on personal finances ‘over the next 12 months’ after the encouraging jump in this measure last month.”

He added: “For a long time, the downward momentum in the Overall Index Score has been associated with our views on the economy. But reduced confidence is now affecting how we see our personal finances.

“If there is a continuation of that dip in our feelings about our ‘future wallets’, we’d quickly see a headline score (the average of our five sub-measures) crash to a level that approaches the worrying figures seen in the worst days of the 2008/2009 financial crisis. We are not there yet, and we may not necessarily get there, but it’s a trend we need to watch carefully.”

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