Personal Finance Concerns Spark Consumer Confidence Record Low |  News

Personal Finance Concerns Spark Consumer Confidence Record Low | News

UK: Consumer confidence fell five points from August to September to hit another record low of -49 amid a cost of living crisis and high inflation, according to the GfK consumer confidence index.

GfK found that there was a nine point drop from the previous month in people’s forecast for their personal finances over the next year, reaching -40 and 45 points lower than in September 2021.

There was a three point drop from August in respondents’ opinion of the performance of their finances in the previous 12 months to -28 in September, which is 24 points worse than the same month last year.

The results are based on a survey of 2,000 adults conducted between September 1 and 14, 2022, and covered a period that included the government’s announcement of the energy bill bailout and the death of Queen Elizabeth II. GfK has conducted the survey since 1974.

The latest survey said that confidence in the country’s overall economic situation over the past 12 months has dropped four points to -72 by September 2022, which is 29 points lower than in September 2021.

There has also been a deterioration in expectations about the general economic situation for the next 12 months, registering a drop of eight points to -68. This is 52 points less than in September 2021.

The Major Purchases Index, which measures whether now is a good time for a major purchase, was unchanged this month at -38, but down 32 points from this month last year.

The savings index, which covers whether now is a good time to save, fell seven points in September but remains in positive territory at +11, although down 11 points from September 2021.

Joe Staton, director of client strategy at GfK, said: “There have been new lows in four of the last five months and all measures are severely depressed again.

“Of particular concern are the two key forward-looking indicators on personal finances over the next year (nine points to -40) and the economy over the next 12 months (eight to -68). These numbers are where many forecasters look for signs of economic optimism among consumers and the results deliver very bad news in that regard.

“Consumers are caving in under the pressure of the UK’s growing cost of living crisis driven by rapidly rising food prices, household fuel bills and mortgage payments. They wonder when and how the situation will improve.”

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