Consumer confidence drops in June

The outlook this month is worse than it was in June 2018 for both personal finances and the economy as a whole. The index measuring changes in personal finances during the past 12 months decreased by four points, while the forecast for the next year is down by three points.

When it comes to the general economic situation, expectations are down by four points to -33, while the measure for the past 12 months is also down.

There has also been a decrease in the major purchase index, which is based on consumers’ views on whether now is a good time to be making expensive purchases such as electrical items or furniture.

June’s overall index score marks the fourth time it has dropped to -13 in 2019, suggesting this could be the "new normal" for consumer confidence, according to Joe Staton, client strategy director at GfK.

"While UK consumers continue to remain concerned about the wider economy, over which the woman or man in the street has no control, of greater worry are the falls in the measures for personal finance," said Staton. "These better reflect our hopes and fears for our everyday financial futures and this, coupled with a decline in the major purchase index, could point to a turbulent time for the economy over the summer months."

The savings index, which is not included in the overall index score, is up for the third month in a row at +19. However, Staton added: "Despite more of us agreeing that ‘now is a good time to save', the official savings ratio stands at near historic lows as households must either dip into their savings or go into debt to fund the cost of day-to-day living. Without the security of a savings buffer, consumers may well be unable to absorb the impact of any downturn a no-deal Brexit might deliver."

The monthly UK Consumer Confidence Barometer is conducted by GfK on behalf of the European Commission. Interviewing took place during 3rd – 14th June 2019.