UK Consumer Confidence dropped by one point in July 2018 to -10, despite increases in both measures for people’s personal financial situation.
Joe Staton, Client Strategy Director at GfK, says:
“Despite the World Cup, Wimbledon and warm weather playing front and centre in the nation’s psyche this July, the Barometer again reveals a decline in consumer confidence.
“The Overall Index Score has now registered at zero or negative since February 2016. Concerns about our personal financial situation, and especially the general economic outlook, have contributed to this long slump. There’s more bad news for retailers too in the form of the Major Purchase Index, which has slipped below zero to reach -2 in July.
“In the medium-term, and during the uncertainty in the run-up to the UK leaving the European Union in eight months, it is hard to forecast what kind of good news will change the numbers from negative to positive, or indeed where such good news would originate. There’s a heatwave in much of the UK but consumer confidence remains stubbornly sub-zero. And in this environment, any bad news such as a surprising uptick in inflation with the expectation of a corresponding increase in interest rates, or any adverse political event either at home or abroad, would likely have an exaggerated downward drag on consumer confidence.”
Personal Financial Situation
The index measuring changes in personal finances during the last 12 months has increased one point this month to +1; this is three points higher than this time last year.
The forecast for personal finances over the next 12 months has increased one point to +7 this month; this is five points higher than July 2017.
General Economic Situation
The measure for the General Economic Situation of the country during the last 12 months has remained unchanged this month at -28; this is three points higher than July 2017.
Expectations for the General Economic Situation over the next 12 months have decreased one point to -26; this is two points higher than July 2017.
Major Purchase Index
The Major Purchase Index has decreased two points this month to -2; this is one point lower than July 2017.
Savings Index
The Savings Index has increased one point to +9 in July; this is four points higher than this time last year.
Download the full GfK Consumer Confidence UK charts – July 2018
UK Consumer Confidence – July 2017 to July 2018
UK Consumer Confidence – GfK Index breakdown July 2018
About the GfK Consumer Confidence UK survey
The UK Consumer Confidence Barometer is conducted by GfK on behalf of the EU, with similar surveys being conducted in each European country. In producing its own reports on the whole of Europe, the EU applies a seasonal adjustment to the data, to smooth out any changes that are functions, at least in part, of the time of year.
Historically, the UK data have not been seasonally adjusted in this way, and to maintain comparability, GfK continues not to apply this adjustment. This can lead to situations where the EU figures show different movements in a particular month from those produced by GfK. Individual months may be affected, but the long-term trend is not.
The UK Consumer Confidence Survey from GfK was conducted among a sample of 2,001 individuals aged 16+ on behalf of the European Commission.
Quotas are imposed on age, sex, region and social class to ensure the final sample is representative of the UK population.
Interviewing was carried out during 1st – 16th July 2018.
The figures contained within the Consumer Confidence Barometer have an estimated margin of error of +/-2%.
Results for the Consumer Confidence Barometer are normally available on the last working day of each month at 00.01am (unless the final working day of a month is a Monday, in which case the results are published on the Friday preceding the final working day). The release date for August 2018 is Friday 31st August 2018.
Any published material requires a reference to both GfK and the European Commission e.g. ‘Research carried out by GfK on behalf of the European Commission’.
This study has been running since 1974. Back data is available from 1996.
The table below provides an overview of the questions asked to obtain the individual index measures:
Personal Financial Situation (Q1/Q2) |
This index is based on the following questions to consumers: ‘How has the financial situation of your household changed over the last 12 months?’ ‘How do you expect the financial position of your household to change over the next 12 months?’ (a lot better – a little better – stay(ed) the same – a little worse – a lot worse) |
|
General Economic Situation (Q3/Q4) |
This index is based on the following questions to consumers: ‘How do you think the general economic situation in this country has changed over the last 12 months?’ ‘How do you expect the general economic situation in this country to develop over the next 12 months?’ (a lot better – a little better – stay(ed) the same – a little worse – a lot worse) |
|
Major Purchase Index (Q8) |
This index is based on the following question to consumers: ‘In view of the general economic situation, do you think now is the right time for people to make major purchases such as furniture or electrical goods?’ (right time – neither right nor wrong time – wrong time) |
|
Savings Index (Q10)
|
This index is based on the following question to consumers: ‘In view of the general economic situation do you think now is?’ (a very good time to save – a fairly good time to save – not a good time to save – a very bad time to save) (Commented on but not included in the Index Score) |
