Belfast Telegraph

Sunday 4 October 2015

Consumer optimism plummets

Published 21/12/2010

Consumers became increasingly pessimistic about the state of the economy and their own finances during this month, research suggested today.

People's confidence in their financial situation during the past 12 months dropped by five points during the month to stand deep in negative territory at minus-16, according to the GfK NOP Consumer Confidence Index.

Britons also feel downbeat about their prospects, with optimism about their financial situation during the coming year falling by one point to minus-eight, well down on the plus-three it stood at in December 2009.

Consumer confidence in the general economy for the past year fell five points to minus-51 during December, while expectations dropped by one point to minus-23, 17 points lower than a year ago.

The only measure of confidence that increased in December was the major purchase index, which jumped by 10 points to minus-seven.

The increase was probably due to a combination of festive spending in the run-up to Christmas and people bringing forward major purchases before the January VAT increase to 20%.

But the rise was enough to offset falls across the other four measures of confidence to keep the overall GfK NOP Consumer Confidence Index unchanged at minus-21, only two points lower than it was in December last year.

Nick Moon, managing director of GfK NOP Social Research, said: "At the moment, consumer confidence is being propped up by one thing: a belief that the run-up to Christmas and the VAT hike is a good time for big-ticket retail purchases.

"This element of the index has distorted the overall index to make it appear static when in fact it is teetering on the brink.

"Every other measure has fallen and without this one positive, consumer confidence would have fallen to its lowest level in over a year.

"Of course, the real test will come in January when festive spending ceases and the VAT increase comes in.

"Then we will finally see the full impact of how consumers are reacting to the first wave of austerity measures."

GfK NOP questioned 2,007 people for the survey between December 3 and 12.

From the web

Sponsored Videos

Your Comments

Comments posted this week will only be visible until Saturday Oct 3 and will not be available to view after that date. This is due to essential upgrade work on our content management system and we apologise for any inconvenience.

COMMENT RULES: Comments that are judged to be defamatory, abusive or in bad taste are not acceptable and contributors who consistently fall below certain criteria will be permanently blacklisted. The moderator will not enter into debate with individual contributors and the moderator’s decision is final. It is Belfast Telegraph policy to close comments on court cases, tribunals and active legal investigations. We may also close comments on articles which are being targeted for abuse. Problems with commenting?

Read More

From Belfast Telegraph