Consumer confidence falls as millions are placed under new lockdown restrictions

·2-min read

Consumer confidence fell over the past month as coronavirus case numbers rose and the government introduced new lockdown restrictions across much of the country.

According to GfK's monthly index, the number of people who said their finances deteriorated in the past year is on the rise. Looking forward, respondents were also more pessimistic about their personal financial situation and the wider economy.

The overall index fell six points from minus 26 to minus 31. Anything below zero indicates that more people have a negative outlook than a positive one.

A fall in confidence could damage the UK's already struggling businesses which face additional restrictions after the new three-tier lockdown approach was unveiled last week.

Millions of households are now under stricter rules that mean they cannot mix with others.

GfK's survey, which has been published regularly since 1974, indicates that people continue to be significantly more confident about their own finances than the economic health of the country.

The measure for the general economic situation during the last 12 months has decreased by six points in October to minus 67, some 34 points lower than a year ago. By contrast, the personal finance measure came in at zero.

Joe Staton, client strategy director at GfK, said: "There's a worrying threat of a double dip in consumer confidence as concerns for our personal financial situation and even deeper fears over the state of the UK economy drag the index down six points this month.

"Despite low inflation and rock-bottom interest rates, a buoyant housing market and a raft of government financial stimulus measures, the prospect of rising unemployment is severely depressing our outlook."

He said the findings were collected before the latest round of Covid-19 restrictions came into force, adding: "Expect the autumn chill to give way to much stormier conditions.

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