Rise in living costs means consumers 'remain cagey' in March

According to GfK’s latest barometer, consumer confidence stood at -6 last month, the same level as February but down six points year-on-year.

Optimism surrounding the UK’s general economic situation over the last 12 months was -21, an 11-point slump year-on-year.

However, the level was flat compared to February.

Consumer confidence about the economy over the year ahead was only marginally better at -20, marking no change from the previous month.

Sentiment about personal finances over the past year edged up one point month-on-month to +2, although that represented a two-point dip year-on-year.

Consumer optimism about their personal finances during the coming 12 months remained flat month-on-month at +3, although that marked a six-point drop year-on-year.

Cost of living

The major purchase index – measuring consumer likelihood to splash out on big ticket items such as furniture and electrical goods – edged up one point compared to February to +6, although that was down five points compared to the previous year.

GfK head of market dynamics Joe Staton said: “Consumers remain cagey about the state of their personal finances and the general economic picture for the UK, especially as wage growth fails to keep pace with the rising costs of living.

“Since the Brexit referendum, household spending has been a big driver of growth, so any slump will dent future economic prospects.

“However, if we carry on shopping, as seen by the uptick in the Major Purchase Index, then forecasts for a post-trigger/pre-Brexit slowdown could be proved wrong.”