// GfK’s long-running Consumer Confidence Index decreased to -14 in August
// This compares to -7 in August last year
// All five measures waned in the face of pre-Brexit nerves
Consumer confidence waned across all measures this month as pre-Brexit nerves took its toll on Brits’ outlook on personal finances and the general economy.
According to GfK’s long-running Consumer Confidence Index, the August reading decreased to -14 compared to -7 that was recorded in the same month last year.
This month’s reading is also worse than the -13 and -11 scores recorded in June and July this year respectively.
Sentiment around the general economy over the next 12 months recorded the most significant decline, coming in at -38 for this month.
It fell six points compared to July’s reading, and is a dramatic drop compared to the -26 recorded in August last year.
Meanwhile, confidence in personal finances for the next 12 months fell five points to 2 on a month-on-month basis, and down from 8 compared to August 2018.
The major purchase index also declined, dropping three points on a month-on-month basis to 1, while the savings index dropped four points to 21.
“Until Brexit leaves the front pages – whenever that will be – consumers can be forgiven for feeling nervous not just about the wider economy but also about their financial situation,” GfK client strategy director Joe Staton said.
“That’s an important distinction because a significant development in August is the sudden drop in views on personal finances ‘over the next 12 months’ after the encouraging jump in this measure last month.
“For a long time, the downward momentum in the Overall Index Score has been associated with our views on economy.
“But reduced confidence is now affecting how we see our personal finances.
“If there is a continuation of that dip in our feelings about our ‘future wallets’, we’d quickly see a headline score (the average of our five sub-measures) crash to a level that approaches the worrying figures seen in the worst days of the 2008/2009 financial crisis.
“We are not there yet, and we may not necessarily get there, but it’s a trend we need to watch carefully.”