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Consumer confidence slips in October

Consumer confidence fell in October despite accelerating wage growth and pre-Budget reports about the imminent end of austerity.

Confidence dropped one point to minus 10 in GFK’s Consumer Confidence Index amid conditions normally ‘sufficient to boost consumer sentiment’.

Confidence in the general economic situation during the past 12 months remained at minus 28 in October, one point higher than a year ago, but expectations for the coming year decreased one point to minus 28, two points lower than last October.

The measure of changes in personal finances over the past year remained at plus one in October, the forecast for the next year decreased one point to plus four.

Confidence in the right time to make big ticket items fell by two points to plus four, although this compared with plus three in October 2017.

‘The recent claims about the imminent end of austerity and the good news of lower retail price inflation and accelerating wages growth would normally be sufficient to boost consumer sentiment. But the core index slipped again this month,’ said Joe Staton, GfK client strategy director.

‘The prospect of a no-deal/hard-deal Brexit must surely be weighing heavily on people’s minds, injecting a mood of despondency as to how people view their future personal finances and the longer-term economic outlook for the UK.’

The survey has been running since 1974 and GfK’s results are used to develop reports for the whole of Europe by the European Commission, which commissions the report.

Image: GfK’s Consumer Confidence Index for the past year