Consumers gloomier
Consumer confidence fell for the sixth month in a row in June as the economic outlook continued to darken, although Britons showed little sign of curbing their spending.
The Nationwide consumer confidence index hit an all time low last month, falling four points to 61 – the worst figure since the survey began in May 2004. A weaker housing market, high food and fuel costs, and fears of an impending recession combined to make consumers feel pessimistic about their finances, according to the survey.
Nationwide said that 53 per cent of respondents expect the economic climate to get worse in the coming months – more than double the proportion of people who felt the same way in June 2007.
In another sign of falling optimism, just 16 per cent of people now say they think their household income will increase in six months’ time, down from 21 per cent in may.
People were more positive about their job prospects, with 50 per cent saying they think there are either some or many jobs available, while 37 per cent expect the job market to stay the same.
Despite the slump in economic confidence, consumers showed no sign of reigning in spending. The number of people who thought it was a good time to make a major purchase, such as a car or a house, increased to 18 per cent – the highest level since July 2007.
“This month’s drop in confidence is to be expected given the recent run of bad news,” said Fionnuala Earley, Nationwide’s chief economist.