UK consumer confidence fell by 2.6 percentage points to -10.4% in the second quarter of 2025, according to Deloitte’s Consumer Tracker, marking the first decline since Q3 2022—when inflation hit a 40-year high.

The latest fall was driven by declines across all six measures of consumer sentiment, with job security confidence seeing the sharpest drop, down 4.8 points. Confidence around personal debt also slipped by 3.7 points.

Despite this, sentiment towards the state of the UK economy improved by 3.9 points compared to the previous quarter, though it remains 18.4 points lower than the same period last year.

Spending also weakened: essential spending dropped 4.6 points, largely due to lower utility bills during warmer months, while discretionary spending edged up by 1.5 points.

The accounting firm’s consumer insight lead Céline Fenech said: “For the last few years we have seen consumer confidence remain relatively resilient despite several economic challenges, geopolitical uncertainty, and the increased cost of living.  

“After recovering from its lowest level on record in the third quarter of 2022, when inflation peaked to a historic high, our consumer confidence index has declined for the first time in almost three years.”

She continued: “This drop in confidence signals a weakening of consumers’ resilience, as concerns of a slowing labour market have left consumers worried about job security and income growth prospects, while persistent inflation and a high cost of living have negatively impacted sentiment towards personal debt. 

“However, we have seen how the mood of the consumer can change and adapt to new circumstances. If an uptick in both economic growth and business sentiment reduces pressures on the job market and on earnings, a return to positive confidence could still be on the cards.”

Last month, it was reported that UK consumer sentiment had improved after months of record-low confidence, according to data from Dentsu.

Confidence in the UK economy notably improved at the end of May, as 28% of consumers described it as in good or excellent shape, compared to less than 20% three months prior.

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