It will take until April to gauge the true immediate impact on consumer confidence of this month’s Budget, according to market research group GfK Nop, but for now sentiment remains worryingly low.
The company’s Consumer Confidence Index for March shows that people’s positive attitude towards their personal financial situation over the last 12 months has dropped, and perhaps more pertinently to retailers their willingness to make big purchases has also slipped away.
GfK Nop’s barometer of the UK population’s happiness levels indicates that, like February, overall consumer confidence is at minus 28 - the only times it has been consistently this low was two years ago and, before that, in the autumn of 1990.
Reflecting the way the mood of the nation has changed since a raft of budget cuts were announced by the new coalition government andthe emergence of other inflationary pressures, consumer confidence is down 13 points year-on-year.
Nick Moon, Managing Director of GfK Nop Social Research, said: “Last week’s Budget was characterised as a budget for growth.
“This month’s figures show how badly some form of stimulus is needed, since consumer confidence has stagnated at depths seldom seen outside of actual recession.”
Commenting on Chancellor George Osborne’s Budget speech, in which he revealed that a proposed fuel duty increase would be scrapped, and instead reduced by 1p, Moon questioned whether the changes will make a difference to consumer sentiment.
“Next month’s figures will reveal whether the Budget really did put fuel in the tank of the economy - or merely poured more cold water on people’s personal finances.”