Consumer confidence in the UK dipped to the lowest level in five and a half years as the country continues to cope with growing uncertainty around Brexit.
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According to the long-running GfK Consumer Confidence Index, overall consumer sentiment among Brits fell to -14 in December from -13 in November, the lowest reading since July 2013.
December’s reading is also five points lower than the index at the beginning of this year and indicates that Brits are likely to tighten their purse strings in the near future.
Despite this, the latest consumer confidence data was still in line with economists’ expectations in a Reuters poll.
GfK said that while people felt better about their personal finances over the past year and were more willing to make major purchases, their future expectations for the economy tumbled to its lowest since December 2011.
This was evident in the six-point fall to -38 in consumer sentiment around the general economic situation over the next 12 months.
GfK also said consumers’ confidence in their own personal financial situation slid into negative territory at -1, thanks to a four-point drop.
However, there was an uptick in the major purchases index, which records the likelihood of people buying big-ticket items, which rose five points to 2 and offset the sharp fall last month.
“UK consumers are ending 2018 on a pessimistic note with Christmas cheer in short supply,” GfK client strategt director Joe Staton said.
“This represents a more than five-year low for the index, which has bumped along in negative territory since 2016.”
“In the face of ever-rising costs, and the threat of higher inflation combined with uncertainty around the outcome of the Brexit negotiations, it’s no surprise that consumers are in a chilly mood of despondency.
“Sad to say that an unhappy and uncertain new year beckons despite good intentions from all points on the economic and political spectrum.”
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