Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
UK consumer confidence is crumbling under the weight of 40-year high inflation despite one of the strongest jobs markets ever seen, according to Joe Staton at GfK, whose survey published Friday showed household sentiment at the lowest on record and with sub-measures even gloomier.
"Nothing on the economic horizon shows a reason for optimism any time soon,” Staton told MNI after GfK’s index declined by 2 points to -40 in May, passing the previous record low of -39 in July 2008. Even the Bank of England is pessimistic, he added, noting that Governor Andrew Bailey this week offered "no hope of tackling inflation."
The worst readings in the data series established in 1974 were to be found in sub-measures, he said, with the index for the general economy over the past year at -63 and at -56 for the coming year, both down from April’s levels and significantly lower than in May 2021.
DEPRESSED REAL EARNINGS
Consumer price inflation running at almost 10%, driven by soaring food and fuel bills, is cutting into real earnings, weighing on household finances and dragging confidence lower despite unemployment at a 50-year low, with vacancies outnumbering job seekers.
"Consumer confidence is now weaker than in the darkest days of the global banking crisis, the impact of Brexit on the economy, or the Covid shutdown," Staton said.
The personal financial situation index for the next 12 months, one of Staton's preferred indicators of sentiment, showed a very modest one-point improvement on the April reading, but still sits at a very depressed -25. A year ago, the index was at +10.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.