LONDON (MNI) – The GfK Consumer Confidence Index fell to a
35-month low of -33 in December, with every reading in the second half
of this year at -30 or below.
The GfK survey highlights how confidence fell away in 2011. In 2010
the average GfK Consumer Confidence Index reading was -18 but this
dropped to an average of -29 in 2011 as a whole and to -31 in the second
half of this year.
With evidence mounting the UK recovery has stalled, and real
household disposable income having been squeezed, confidence has been
exceptionally low. The long run average in the GfK series, which extends
back to 1974, is -8.
The index fell to -30 in mid 1975 and hit an all time low of -39
when the credit crunch was raging back in July 2008. Now confidence has
fallen back to within touching distance of those credit crunch low.
Bank of England policymakers, however, believe things could improve
for UK consumers next year with the squeeze on real incomes set to ease
as inflation falls back sharply.
The detail of the GfK/NOP survey shows the public does expect some
relative improvement in its finances next year. The reading for people’s
personal financial situation over the past 12 months held steady at -23
in December, and was unchanged for the next 12 months at -10.
People are more gloomy about the economic outlook, with this
balance for the next 12 months dropping to -41 from -33 in November.
The climate for major purchases reading fell to -31 from -27.
The GfK/NOP survey was carried out between Dec 2 and Dec 11.
–London newsroom 44207 862 7491; email: drobinson@marketnews.com
[TOPICS: M$B$$$,MABDS$]
