Consumer confidence hits all-time low

The drop of three points this month follows a steady decline over the past year and compares to a score of -8 in August 2021.

All five measures in the index were down on the last monthly update. Consumer confidence on the general economic situation fell a further three points to -60, compared to -6 in August 2021.

While their confidence in their personal financial situation declined by five points (the steepest decline of all the measures) to -31 points – 42 points lower than this time last year.

The major purchase index decreased by four points to -38, however the savings index (which is recorded but not used in the overall index, was actually up by five points to +18 – seven points lower than this time last year.

Joe Staton, client strategy director, GfK said: “The Overall Index Score dropped three points in August to -44, the lowest since records began in 1974. All measures fell, reflecting acute concerns as the cost-of-living soars. A sense of exasperation about the UK’s economy is the biggest driver of these findings.

“Our sub-measure on the general economy over the past year has decreased month-on-month since December 2021 – that’s eight months in a row. A similar consistent sharp decline since December 2021 is evident in how consumers see the economy a year ahead and this month’s score of -60 sets a new record.

Staton added that the findings pointed to a sense of capitulation, of financial events moving far beyond the control of ordinary people.

“With headline after headline revealing record inflation eroding household buying power, the strain on the personal finances of many in the UK is alarming. Just making ends meet has become a nightmare and the crisis of confidence will only worsen with the darkening days of autumn and the colder months of winter.”