–GfK/NOP: UK June Consumer Confidence -19 Versus -18 May

LONDON (MNI) – UK consumer confidence slipped in June to its lowest
level so far this year, with the Gfk/NOP’s index falling to -19 from -18
in May as consumers fretted over talk of tax rises in the June 22
Budget, according to Gfk/NOP.

Optimism rose in the personal financial situations index
for the next 12 months, with this index returning to positive territory.
A growing number of consumers, however, believe now is not a good time
to make a major purchase and that data suggest weakening demand, at
least for big ticket items.

The Gfk/NOP survey found that over the past 12 months there was a
slight decrease in consumers’ perceptions of the general economic, and
their personal financial, situation.

The measure for consumers’ personal financial situations over the
past 12 months slipped to -14 in June from -13 in May, while
expectations for the personal financial situations over the next 12
months rose to -2 from -3 in May.

Similarly, consumers were more downbeat about the economic
situation over the past 12 months, with this balance falling to -46 from
-45 in May. The forward looking reading for the economic situation
dropped to -12 from -9.

The survey’s findings suggest there will be weak demand for
big-ticket items over the next 12 months. The question on whether now is
a good time to make a major purchase returned a negative net balance of
24, down from a negative net balance of 21 in May.

Consumers are, instead, more inclined to save. The “now is a good
time to save” index, rose to -4 from -5, which is up eleven points from
a year ago.

The survey was conducted between June 4 and June 20, a period
marked by mounting speculation over what tax rises and spending cuts
would be unveiled in the June 22 budget.

“The ongoing debate around spending cuts and speculation around tax
hikes in the lead-up to the emergency budget has impacted consumer
confidence, with gains from December to February now lost,” Nick Moon,
managing director of Gfk NOP Social Research, said.

“Concerns about the fragility of the recovery and the potential for
a double-dip recession may be exacerbated by the fall in confidence in
the general economy,” Moon said. ” The outlook for major purchases has
also dropped, which suggests the government cannot rely on consumers to
fuel growth.”

–London newsroom 44207 862 7491; email:ukeditorial@marketnews.com

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