Consumer confidence dips despite warm weather

Consumer sentiment dropped to -12 in July, with shoppers’ outlook on personal finances and the general economy over the next year, as well as customer inclination to make major purchases, all registering declines.

Confidence has been in negative territory since February 2016, according to the GfK Consumer Confidence Index.

Customer sentiment on their savings and personal finances over the past year both registered a 1 point rise during the period to 5 and -2 respectively, while confidence in the economy over the past year held steady at -31.

Confidence about personal finances and the general economy over the next year both declined one point to 2 and -28 respectively, while the major purchase index fell two points to -1.

GfK’s client strategy director Joe Staton said: “Despite the World Cup, Wimbledon and warm weather playing front and centre in the nation’s psyche this July, the barometer again reveals a decline in consumer confidence. The Overall Index Score has now registered at zero or negative since February 2016.

“In the medium term, and during the uncertainty in the run-up to the UK leaving the European Union in eight months, it is hard to forecast what kind of good news will change the numbers from negative to positive, or indeed where such good news would originate.

“In this environment, any bad news such as a surprising uptick in inflation with the expectation of a corresponding increase in interest rates, or any adverse political event either at home or abroad, would likely have an exaggerated downward drag on consumer confidence.”