Consumer confidence tumbles with ‘no sign of bounce-back’

Shopper sentiment dropped two points to -36 during the past two weeks, just three points shy of historic lows recorded during the financial crisis of 2008.

Concerns over the state of the UK economy over the next 12 months mounted, according to GfK’s latest Consumer Confidence Index, as that metric fell three points to -57.

Consumers’ confidence about their own personal finances also declined. GfK reported a six-point decrease in sentiment to -10 over the past year, while confidence about their personal finances in the coming 12 months dipped one point to -10.

However, the major purchase index jumped six points to -41, indicating that there could be some pent-up demand for big-ticket items such as furniture during lockdown.

GfK client strategy director Joe Staton said: “Against a backdrop of falling house prices and soaring jobless claims, and with no sign of a rapid V-shaped bounce-back on the cards, consumers remain pessimistic about the state of their finances and the wider economic picture for the year to come.”

Staton said the major purchase index offered “the only bright spark” and added: “As the lockdown eases, it will be interesting to see just how the consumer appetite for spending returns in a world of socially distanced shopping and the seismic shift to online retailing – alongside worries of a fresh spike in Covid-19 cases as relaxations increase.”