London,
21.10.2022
UK consumer confidence claws back meagre two points at -47 in October
UK consumers grappling with ‘new abnormal’ amid uncertainty and turmoil
GfK’s long-running Consumer Confidence Index increased two points in October to -47. Three measures were up, one was flat and one decreased in comparison to the September 23rd announcement.
Joe Staton, Client Strategy Director, GfK says:
“UK consumer confidence continued to bump along close to last month’s historic low, with an Overall Index Score of -47 in October. However, all core measures remain severely depressed. The three-point fall in the major purchase measure continues a steep downward trend that began in July 2021 and is especially worrying for the final quarter of the year, which many businesses rely on to strengthen their balance sheets. But the biggest danger by far is inflation, now rising at its fastest rate for 40 years. Households are not just running scared of burgeoning energy and food prices, and the prospect of further base rate rises increasing mortgage costs. They are now facing the likelihood of tax rises and even austerity measures. For ordinary consumers, this web of uncertainty and turmoil amounts to a ‘new abnormal’. The negative environment will deflate future spending plans, and cautious consumers could easily slow the UK economy still further. Consumers, like governments, are just as capable of U-turns, and today’s economic headwinds indicate a long hard winter.”
UK Consumer Confidence Measures – October 2022
The Overall Index Score increased two points in October to -47. Three measures were up, one was flat and one decreased in comparison to the September 23rd announcement.
Personal Financial Situation
The index measuring changes in personal finances over the last 12 months was the same at -28; this is 23 points worse than October 2021.
The forecast for personal finances over the next 12 months has increased six points to -34; this is 35 points lower than this time last year.
General Economic Situation
The measure for the general economic situation of the country during the last 12 months is up three points at -69; this is 23 points lower than in October 2021.
Expectations for the general economic situation over the coming 12 months have improved by seven points to -61, although this is till 35 points lower than October 2021.
Major Purchase Index
The Major Purchase Index is has fallen three points to -41; this is 31 points lower than this month last year.
Savings Index
The Savings Index is up two points this month at +13; this is nine points lower than this time last year.
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About the survey
- The UK Consumer Confidence Barometer is conducted by GfK.
- This month’s survey was conducted among a sample of 2,001 individuals aged 16+.
- Quotas are imposed on age, sex, region and social class to ensure the final sample is representative of the UK population.
- Interviewing was conducted between October 3rd and October 13th 2022. The start date was after the ‘mini-budget’ while the end date was the day before the previous Chancellor of the Exchequer left office.
- The figures contained within the Consumer Confidence Barometer have an estimated margin of error of +/-2%.
- The Overall Index Score is calculated using underlying data that runs to two decimal points.
- The confirmed date of the next press release is November 18th. The date of the final press release for 2022 is December 16th. Dates for the first half of 2023 are: January 20th; February 24th; March 24th; April 21st; May 19th and June 23rd.
- Any published material requires a reference to GfK e.g. ‘Research carried out by GfK’.
- This study has been running since 1974. Back data is available from 2006.
- The table below provides an overview of the questions asked to obtain the individual index measures:
Personal Financial Situation
(Q1/Q2)
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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)
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General Economic Situation
(Q3/Q4)
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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)
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Major Purchase Index
(Q8)
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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)
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Savings Index
(Q10)
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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)
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