The concerns were depressing confidence across all measures recorded by GfK, Bellamy said, with a dive in the closely-watched personal finance outlook a particularly worrying sign.
"Strong consumer confidence matters because it underpins economic growth and is a significant driver of shoppers’ willingness to spend," he explained. “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 in the GfK index fell sharply. Major corrections were seen in the outlook for personal financial situations for the next 12 months (down nine points), 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 Bank of England interest rate, this is not encouraging news for the UK’s new government," Bellamy added. While the Bank of England left interest rates unchanged on Thursday, there are growing expectations of a further cut in November.
Perhaps surprisingly, the savings index also fell sharply, down ten points to +23, underlining that consumers, although not prepared to make large purchases, are also not seeing themselves in a position to commit to saving.
