Consumer confidence slumps as gloom over economy sets in
Consumer confidence has slumped amid a "resolutely gloomy" economic outlook and a sharp drop in spending plans, figures show.
The GfK Consumer Confidence Index has seen a five-point drop on the back of a two-point fall in October, taking it to minus eight, with all five measures taking a tumble.
Despite recent strong retail sales, the index is showing a sharp nine-point drop in consumer plans for major purchases, spelling bad news for retailers as they gear up for the peak Christmas selling period.
The index, compiled on behalf of the European Commission, shows a two-point drop in changes to personal finances over the past year and a four-point fall for the same measure looking to the year ahead.
The measure for the general economic situation of the country during the past 12 months has dropped six points - 19 points lower than this time last year - and has fallen five points for the year ahead.
Joe Staton, head of market dynamics at GfK, said: "The slump across the board this month points to continuing uncertainty about the state of the economy among consumers.
"We are viewing our economy over the past 12 months with increasing despondency. The decreasing score on the economy for the next 12 months also shows we are resolutely gloomy about the outlook despite strong GDP numbers.
"Despite recent strong retail sales, we are reporting a sharp nine-point drop in the major purchase index this month and this will be an acute concern for retailers as they gear-up for the key Christmas selling period.
"Many are saying that fears about the British economy have been overstated but time will tell if the pessimism shown in the index is misplaced or not."
Interviewing for the survey was carried out during the first half of the month to November 15, ahead of last week's Autumn Statement.