Overall consumer confidence has fallen five points in November to -8, driven by growing fears about the economy, latest GfK figures show. 

GfK said this has caused declines across all five index measurements in the month to November 30. 

Of the measures, confidence in the general economic situation in the past 12 months dropped most dramatically – by 25 points – with confidence for the next 12 months also sliding 22 points.

Overall consumer confidence did show signs of recovery in September, but started to slip again in October.

Despite this month’s steep slide, the index has not yet sunk to the level of -12 that it reached in July after the EU referendum.

Low confidence forecast

GfK head of market dynamics Joe Staton said this month’s “across the board slump” points to “reduced confidence in the UK economy looking back and ahead”.

He said: “We are viewing our economy over the past 12 months with increasing despondency. The decreasing score on the economy for the next 12 months also shows we are resolutely gloomy about the outlook.”

He explained that this figure has been low since the UK’s vote to leave the EU, “as ongoing economic turmoil, inflationary pressures and global anxiety impact levels of confidence”.

The impact on spending

Staton said that, despite recent strong retail sales, there has been a sharp -9 point drop in the major purchase index this month.

“This will be an acute concern for retailers as they gear up for the key Christmas selling period,” he warned. 

“Many are saying that fears about the British economy have been overstated, but time will tell if the pessimism shown in the index is misplaced or not.” 

Confidence in personal finances fell by two points, but “just about remain positive”, coming in at 1 on the index.

At its full-year results earlier this week, Topps Tiles boss Matt Williams warned that negative consumer confidence could have a bearing on performance, but said the extent of the impact “remains unclear”.

However, retailers of small-ticket items, such as tween stationery retailer Smiggle, maintain that the Brexit vote has had “no impact on consumer confidence at all.”

 

 

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