NEWS29 July 2016

UK confidence plummets to 26-year low

Finance News Trends UK

UK — Consumer confidence in the UK fell by 11 points to -12 in July, the sharpest month-by-month drop since March 1990, according to GfK’s Consumer Confidence Index. 

Financial decline crop

This represents a further three point drop from the -9 recorded in the Brexit Special in early July.  All five measures used to calculate the index – personal financial situation (over last and next 12 months), general economic situation (over last and next 12 months), and major purchase index – saw decreases this month. 

“Consumers in post-Brexit Britain are reporting higher levels of concern this month," said Joe Staton, head of market dynamics at GfK.

"We’ve seen a very significant drop in confidence, as is clear from the fall in each of our key measures, with the biggest decrease occurring in the outlook for the general economic situation in the next 12 months (-19 points). Although the rate of decline is slower than reported in the aftermath of the vote to leave the EU, consumers in the UK were also less optimistic about the state of their personal financial situation going forward (-9 points).

"However, the index continues to remain at a relatively elevated level by historic standards. Its future trajectory depends on whether we enter a new period of damaging economic uncertainty or restore confidence by embracing a positive stance on negotiating a new deal for the UK.”

The full report can be accessed here