Subscribe Login
DE4CC0DE-5FC3-4494-BCBF-4D50B00366B5
Retail

UK Consumer Sentiment Hits Record Low As Inflation Soars: GfK

British households are feeling 'a sense of exasperation' about the surging cost of living which has pushed consumer sentiment to its lowest since at least 1974, according to the country's longest-running survey of household finances.

The GfK consumer sentiment index sank to a record-low -44 in August from July's reading of -41, which was already the lowest since the survey began. Economists polled by Reuters had forecast a drop to -42.

Households' assessment of their personal finances and the general economic situation declined, both looking back at the past 12 months and for the year ahead.

"All measures fell, reflecting acute concerns as the cost of living soars. A sense of exasperation about the UK's economy is the biggest driver of these findings," said Joe Staton, GfK's client strategy director.

Consumer Sentiment

British consumer sentiment has declined steadily over the past year as inflation has risen sharply, climbing above 10% last month for the first time since 1982.

To date, the knock-on impact on consumer-facing businesses has been less dramatic, but the Bank of England expects further price rises will tip the economy into recession later this year.

Food prices have risen at their fastest rate since 2008, while regulated household energy bills have doubled. Industry analysts say they look set to double again to more than £4,000 ($4,816.80) a year by January.

Read More: Irish Consumer Sentiment Hovers At 22-Month Low In August

"Making ends meet has become a nightmare and the crisis of confidence will only worsen with the darkening days of autumn and the colder months of winter," Staton said.

Separate figures from Lloyds Bank showed nine out of 14 business sectors contracted in July, up from four in June and the most since January 2021 when there was a COVID-19 lockdown.

Transport, tourism and recreation recorded the biggest falls in activity reflecting the impact of rail strikes and reduced consumer spending, Lloyds said.

News by Reuters, additional reporting by ESM – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.

Stay Connected With Our Weekly Newsletter

Processing your request...

Thanks! please check your email to confirm your subscription.

By signing up you are agreeing to our Terms & Conditions and Privacy Policy
Enjoy unlimited digital access for 30 days
Get exclusive access to the latest grocery retail & FMCG news, interviews with industry leading executives, and expert analysis on the trends shaping the sector today
Enjoy unlimited digital access for 30 days
Enjoy unlimited digital access for 30 days
Get exclusive access to the latest grocery retail & FMCG news, interviews with industry leading executives, and expert analysis on the trends shaping the sector today
Enjoy unlimited digital access for 30 days