• Text size      
  • Send this article to a friend
  • Print this article

UK consumer confidence drops as base rates could rise

UK consumer confidence has fallen this month to its lowest level since April, with people less enthusiastic about the economic situation.

The fall is revealed in the latest monthly barometer conducted by pollster GfK on behalf of the European Union. GfK's UK consumer confidence index dipped from plus-1 in June to minus-2 in July, having been at zero in May.

The deterioration mainly reflected a shift in consumers' view of the general economic situation over the last 12 months and the coming year, although sub-indices covering people's personal financial situations, past and future, and the climate for major purchases also fell.

Nick Moon, managing director of social research at GfK, said: "No sooner had the index crossed into positive territory last month - for the first time in nearly 10 years - than it fell back into the negative. All five of the component parts of the index fell this month, with four-point drops in both the questions about the country's general economic situation being particularly noticeable.

"The almost relentless rise of the last six months couldn't continue indefinitely, and the government will be hoping this is just a temporary setback rather than the forerunner of a wider decline in confidence."

The drop in confidence has come as speculation has mounted that the first rise in UK base rates from their record low of 0.5 per cent may not be far away. Economists are expecting an increase later this year or in early 2015.

Contextual targeting label: 
Finance

Commenting & Moderation

We moderate all comments on HeraldScotland on either a pre-moderated or post-moderated basis.
If you're a relatively new user then your comments will be reviewed before publication and if we know you well and trust you then your comments will be subject to moderation only if other users or the moderators believe you've broken the rules

Moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours. Please be patient if your posts are not approved instantly.

251407