Vaccine promises do little to boost consumer confidence

The GfK consumer confidence index dropped two points in January to -28 as the country once again found itself in lockdown and the UK exited the EU.

Although the vaccination programme has been under way since the beginning of the year, consumer sentiment about the general economic situation for 2021 declined nine points to -44, while feelings about the previous year were down two points to -67.

The survey found that consumers’ confidence in their personal finances for the next 12 months also fell by one point, driven by a drop in the major purchase index, which was down two points from December.

The only measure that increased was consumer sentiment over personal finances last year, rising one point.

GfK client strategy director Joe Staton said: “Despite the widespread anticipation of a ‘return to normal’ with the ramp-up of the vaccination programme, it is too early to deliver a jolt in the arm to UK consumer confidence.

“Our view of the general economic situation still makes for grim reading, especially expectations for the coming year, which show a nine-point drop.

“This continues to suppress the overall index, which is further dampened by a weak major purchase score, as reflected in retail sales figures across the country. The real key is how we view our personal financial situation for the next 12 months.

“Confidence in this figure reflects our financial hopes and fears, as well as those of our families and loved ones, and it seems to be holding up.

“That’s just as well because, amid widespread uncertainty over jobs and livelihoods, any decline in how we see our personal finances in the year to come would be a clear warning that the economic outlook will not improve any time soon.”