UK consumer confidence takes Brexit-linked downturn says GfK

By

Sandra Halliday

Published
Nov 30, 2018

This may not come as a huge surprise, but UK consumer confidence dropped again in November, falling three points to -13. GfK’s long-running consumer confidence index saw all five of the measures used to calculate the final figure decreasing.

And it seems that Brexit had a big part to play. Joe Staton, Client Strategy Director at GfK, said: “Against a backdrop of the Chancellor telling everyone that the Brexit deal on the table will make people worse off, this month we’re recording an across-the-board fall for all measures with concerns over household finances, the general economy and purchase intentions.”

Worryingly for the retail sector, the measure that fell the most was the Major Purchase Index, with a seven-point plunge.

The fall took the overall index back to the -13 level it saw at the end of last year and Staton added that “the next few weeks are highly unlikely to inject any festive cheer, especially if Theresa May’s Brexit deal doesn’t win backing from MPs. The denouement to more than two years of bewildering Brexit wheeler-dealing looks like it will be enacted precisely when many consumers would prefer to be thinking of a well-earned Christmas break, filled with family get-togethers, warmth and festivity. Brexit appears to be turning this year’s ‘season of goodwill’ into ‘the season of uncertainty’.”

So let's look more closely at the actual figures. As mentioned, the overall score took the level down to -13, which is worse than the -12 of a year ago and the -10 in October.

Consumers were much more downbeat about their personal financial situation over the last 12 months and also looking at the next 12 months. And they were also more pessimistic about the general economic situation over the last 12 months and in the year ahead.

As mentioned, that fall in the Major Purchase Index was particularly significant. It dropped to -3, which is the same level it was at exactly one year ago, but is down noticeably from the +4 recorded in October and +6 in September when some level of confidence appeared to have returned following the glorious summer the UK enjoyed.