MNI FIVE THINGS: UK Consumers Gloom Over Economy Intensifies

-GfK UK Consumer Confidence Unchanged At -14 In Jan; Economic Situation Slips

By David Robinson

     LONDON (MNI) - The January GfK UK consumer confidence survey showed the

headline index matching the December outturn, which was the lowest since

mid-2013.

     The following are key points from the report:

     --The GfK Consumer Confidence Index came in at -14 in January, unchanged

from December. It was last below this level back in the summer of 2013, hitting

-16 in July 2013. It is still well above its global financial crisis lows,

hitting a trough of -39 in July 2008.

     --The sub indices reflected a mix of deep pessimism over the economic

outlook combined with consumers being fairly upbeat over their personal

finances, with unemployment low by historic standards and some signs of earnings

growth.

     --The January reading of -39 for the general economic situation over the

next 12 months, down from -38 in December, was the weakest for just over seven

years, with it hitting -41 in December 2011.

     -In sharp contrast, the measure for the outlook for personal finances over

the next 12 months rose to 1 in January from -1 in December. The Major Purchase

Index, asking consumers whether now was a good time to buy a big ticket item,

was unchanged at 2 in January, one point higher than a year ago.

     --The composite headline index reflects the balance of the relatively

upbeat expectations for personal finances and the gloom over the economic

outlook. There is some evidence that consumers perceptions of the personal

finances may be a better guide to future spending, but there is a diversity of

views among economists over how useful confidence measures are as a guide to

future spending.

     --Joe Staton, Client Strategy Director at GfK, attributed the economic

gloom to Brexit related uncertainty although there is nothing in the questions

to isolate this effect.

     --The savings index, a measure of whether now is a good time to save, edged

down to 14 in January from 16 in December, still up from 10 a year ago. 

--MNI London Bureau; tel: +44 203-586-2223; email: david.robinson@marketnews.com

[TOPICS: MABDS$,MAUDR$,MAUDS$,M$B$$$,M$E$$$,M$U$$$]