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Consumer confidence stalls in March

Consumer confidence stalls in March
Emma Lunn
Written By:
Emma Lunn

Brits’ optimism about the economy for the next 12 months has flatlined, according to the GfK Consumer Confidence Index.

The index remains at -21 in March, the same as in February. Three measures were up and two were down in comparison to last month’s announcement.

The UK Consumer Confidence Barometer is conducted by GfK. Each month since January 1974, it has provided a snapshot of how UK consumers feel about the crucial economic topics today and their outlook for the next 12 months, by looking at five different measures.

The index measuring changes in personal finances during the past year is up one point at -13; this is 13 points better than March 2023. The forecast for personal finances over the next 12 months is up two points at +2, which is 23 points higher than this time last year.

The measure for the general economic situation of the country during the past 12 months is down two points at -45; this is 17 points higher than in March 2023.

Expectations for the general economic situation over the next 12 months have increased by one point to -23; this is 17 points better than March 2023.

The major purchase index is down two points to -27; this is six points higher than this month last year.

The savings index has decreased four points to +25 in March; this is four points higher than this time last year.

‘View of the wider economy over the past year is down’

Joe Staton, client strategy director at GfK, said: “Consumer confidence stalled at -21 in March, following the two-point dip in February. The improved personal finance measure (next 12 months) at +2 is encouraging because it’s the first positive and the highest score since December 2021.

“This is welcome news given the challenges faced by Britons of fiscal drag, higher costs for fuel, rising council taxes and utilities eroding any increases in wages or other income.

“But is there a note of worry this month? Look back to last year and it’s clear the improvements in consumer confidence seen most months since January 2023 have vanished. Moreover, this month the major purchase index has dropped two points, the view of the wider economy over the past year is down and the savings index has dived four points. Are we temporarily on pause, or are consumers about to press ‘reverse’? In the run-up to the next UK general election, these are important questions for the future health of the economy.”

The lowest GfK score recorded was -49 in September 2022, and other lows include -39 in July 2008, during the global financial crisis, and a score of -35 in March 1990, in the lead-up to the 1990-91 recession.

The largest monthly increase was in May 1993, when the headline score jumped 12 points.

Related: Consumer confidence increases in January