UK consumer confidence took a significant hit in September, with GfK's long-standing Consumer Confidence Index dropping by seven points to -20. Key indicators for personal finances, the economy, and purchase intentions all saw sharp declines compared to the previous month, reflecting growing concerns about the financial outlook. All measures were down in comparison to last month's announcement.
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Neil Bellamy, Consumer Insights Director, GfK, says: 'Headline consumer confidence has recorded a big fall this month to -20, taking us back to a similar level seen at the beginning of this year. All five measures are down, but there are major corrections in the outlook for our personal financial situation for the next 12 months (down nine points), our views on the general economy for the coming year (down 12 points), and the major purchase index (down ten points).
These three measures are key forward-looking indicators so, despite stable inflation and the prospect of further cuts in the base interest rate, this is not encouraging news for the UK's new government. Strong consumer confidence matters because it underpins economic growth and is a significant driver of shoppers' willingness to spend. Following the withdrawal of the winter fuel payments, and clear warnings of further difficult decisions to come on tax, spending and welfare, consumers are nervously awaiting the Budget decisions on 30th October.'
Personal financial situation
The index measuring changes in personal finances during the last year is down two points at -9; this is nine points better than September 2023. The forecast for personal finances over the next 12 months is down nine points at -3, which is three points higher than this time last year.
General economic situation
The measure for the general economic situation of the country during the last 12 months is down two points at -37; this is 16 points higher than in September 2023. Expectations for the general economic situation over the next 12 months are down 12 points at -27; this is two points better than September 2023.
Major purchase index
The Major Purchase Index is down ten points to -23; this is five points higher than this month last year.
Savings index
The Savings Index has decreased ten points to +23; this is the same as this time last year.
More information:
GfK
www.gfk.com
