UK consumer confidence inched up two points in December but remains at record low levels as retailers warned of a tough road ahead.
The GfK consumer confidence index inched up two points to -42 in December compared with November.
While the situation improved marginally during this period, December represents the eighth month in a row that the consumer confidence index has remained below -40 – the first time this has happened since records began.
Consumers’ confidence in their personal financial situation over the past 12 months fell four points, down to -28, while the consumer view of their financial situation over the next 12 months stayed flat at -29.
In terms of the general economic situation over the past 12 months, consumer confidence inched up one point to -66 and was up five points to -53 over the next 12 months. The major purchase index was up four points to -34.
Joe Staton, client strategy director at GfK, said: “December marks the eighth month in a row in which the index has bumped along at -40 or worse, the first time this has happened since our records began nearly 50 years ago. Despite the latest GDP figures showing slight growth in October, the warning is of a tough road ahead and that the UK is not out of the recessionary woods.
“Real wages are falling as inflation continues to bite hard, further straining the discretionary budget of many households as we enter the last few shopping days before Christmas. The outlook for our personal financial situation over the next 12 months – perhaps the key metric as we enter a new year – is stuck at -29. And concerns about our economic future remain acute.
“As we enter the festive season, the overall index score is still depressed and, with scant seasonal joy at present and no immediate prospect of fiscal good news, it is unlikely we will see a rebound in confidence any time soon.”
To discover how to navigate the challenges the rise in the cost of living will present this Christmas season and in 2023, register for free access to the Crisis and the consumer report now. It will detail why you should:
- Prioritise value for money – this is consumers’ number-one concern
- Think creatively – educate, share ideas and foster a positive sense of being in this together
- Tailor your response – people are affected in different ways and will require different messaging and solutions
- Cut costs where possible – identify what can be cut and where efficiencies can be found
- Not forget about sustainability – purpose still matters and will continue to do so as the crisis evolves
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