Consumer confidence in the UK has significantly fallen before the October Autumn Budget, as indicated by the British Retail Consortium’s latest data.
- Consumer expectations regarding their personal financial situation have decreased, marking a negative shift as compared to the previous month.
- The overall economic outlook has worsened, reflecting a diminished sentiment among consumers compared to August figures.
- Contrasting this, retail spending intentions show a slight improvement, despite the broader economic concerns.
- The Autumn Budget is seen as a crucial opportunity to restore economic confidence among consumers and businesses alike.
The British Retail Consortium (BRC) Consumer Sentiment Monitor highlights a noticeable dip in consumer confidence as the Autumn Budget approaches. Data collected from 10 to 13 September shows a decline in consumer expectations for personal financial situations, dropping from +1 in August to -6 in September. Similarly, perceptions of the economy have deteriorated, plunging from -8 to -21 within the same period.
Despite the declining confidence in economic conditions, there is a slight improvement in personal spending on retail, which increased to -8 in September from -9 in August. This indicates a nuanced view among consumers, where retail spending shows resilience even amidst broader economic pessimism.
Conversely, overall personal spending declined slightly, with figures slipping to +10 in September from +11 in August. Personal savings have also seen a decrease, falling from -4 to -9 in the last month. This reflects a potential shift in consumer priorities, possibly due to economic uncertainties.
Helen Dickinson, Chief Executive of the BRC, remarked on the situation, stating: ‘Retailers could face a turbulent few months as consumer confidence fell significantly in September. Negative publicity surrounding the state of the UK’s finances appears to have damaged confidence in the economic outlook, particularly among older generations.’ Despite this, she noted that expectations for retail spending remain modestly positive, with a tendency among consumers to reduce savings instead of spending.
The imminent Autumn Budget presents an opportunity to bolster confidence and stimulate economic activity. It is suggested that measures such as a ‘Retail Rates Corrector,’ a proposed 20% adjustment to retail property rates, could foster investment in local high streets and communities. Such measures aim to boost consumer confidence, create jobs, and enhance community investment.
The Autumn Budget is poised as a critical moment to potentially reverse the current decline in consumer confidence and invigorate the economy.
