More than half (53%) of UK consumers predict the economy will worsen over the next 12 months, according to Which?

The consumer group also found that 2.1 million people are struggling to afford essential payments during the cost of living crisis.

Which?’s latest Consumer Insight Tracker found that recent improvements in consumer confidence in the economy and household finances are showing signs of faltering. Just a fifth (21%) said that they thought the economy would improve. This gives a net confidence score of -32 for the future of the economy – a five point drop from last month but higher than last October’s score of -63.

Which? found that consumers’ confidence in their future household financial situation and the UK economy had been slowly increasing since this time last year but in the month to 9 October, it started to show signs of faltering.

Confidence in household finances

Confidence in future household finances remained negative, at -11, with a third (34%) saying that they thought their household’s financial situation would worsen and just a quarter (23%) saying they thought it would improve.

Consumer confidence in the economy is closely linked to household finances, with eight in 10 (79%) of those who think their household finances will worsen also feeling very negatively about the future economy.

Those who felt pessimistic about their future household finances are also more likely to believe bills will increase in the next year. Nine in 10 (90%) said they think fuel and food bills (89%) will increase and more than eight in 10 (85%) believe housing costs and energy (84%) will rise.

In comparison, around six in 10 of those who felt positively about their future household finances thought that fuel prices (61%), housing costs (60%) and food bills (59%) would increase over the next year. Just over half (53%) thought energy bills would rise.