Already-weak UK consumer confidence set for "bleak midwinter" - GfK

By

Nigel TAYLOR

Published
Dec 17, 2021

The swift arrival of Omicron came too late to further rattle the UK’s already-fragile consumer confidence for December, with it slipping just one point on an already stark reading of -15, GfK’s long-running Consumer Confidence Index showed Friday.

But with the latest Covid variant seemingly out of control and worries about its true effect, expect January’s reading to be even starker, it warned.

“t looks like it will be a bleak midwinter for UK consumer confidence possibly with new Covid curbs and little likelihood of any real uplift in the first months of 2022,” warned GfK’s Client Strategy Director Joe Staton.

In its report, consumers did say they were now less inclined to make major purchases this month, with the Major Purchase Index dipping three points to -6, albeit 16 points higher than it was this month last year when the effects of pandemic were raging and vaccinations hadn’t yet made an impact.

The index measuring changes in personal finances over the last 12 months may have increased two points to -5 (four points better than December 2020), but the forecast for personal finances over the next 12 months dipped one point to +1, two points lower than this time last year.

The measure for the general economic situation of the country during the last 12 months was one point better at -39; some 26 points higher than a year ago. Expectations for the general economic situation over the coming 12 months dropped one point to -24,11 points higher than December 2020.

The Savings Index weakened by one point to +14 in December, three points lower than this time last year.

Staton added: “News about the Omicron variant could not have arrived at a worse time for festive celebrations. 

“While the holiday season has not yet been hijacked, December’s headline score [shows] the lack of Yuletide cheer is evident. This is driven by concerns over the soaring cost of living with the prospect of looming interest rate rises piling on more pressure.”