U.K. consumer confidence remains weak, survey finds

By Joshua Kirby

Consumer confidence remains weak in the U.K. amid continued concerns over the economy, according to a survey published Friday.

Research group GfK's consumer confidence barometer was unchanged in March at minus 21, thwarting economists' hopes of a slight uptick, as set out in a poll conducted by The Wall Street Journal.

The barometer still stands at a level higher than in almost every month since the start of 2022. But the steady improvement booked since January last year has vanished, said Joe Staton, client strategy director at GfK.

One bright spot is an improvement in the gauge of personal finances, with respondents registering their brightest outlook 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," Staton said.

Feelings about the current general economic situation worsened, however, as did confidence about making major purchases, while the gauge of sentiment on the economy over the coming year improved very slightly but remained low.

Consumer confidence is key to the recovery in household spending that could drive growth in the U.K. economy this year. Retail volumes rebounded sharply at the start of the year, and figures for February-due to be published later Friday-will offer an insight into spending trends. Economists expect a slight downturn on the month.

The question for the coming months is whether consumers are cautious but ready to offer a brighter outlook ahead, or if confidence is at risk of sliding backward once more, GfK's Staton said.

"In the run-up to the next U.K. general election, these are important questions for the future health of the economy," he said.

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03-21-24 2006ET

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