​Further blow to UK retail: concerns over personal finances grow

By

Nigel TAYLOR

Published
Nov 20, 2020

Just when you thought UK retail confidence couldn't get any worse. Further worrying news emerged Friday that consumer confidence fell again and concerns over personal finances for 2021 dipped further, according to GfK.

That could mean depressingly tighter purse strings will be a blow for non-essential retail across 2021.

That twin hammer blow comes as GfK’s long-running Consumer Confidence Index delivered another fall in monthly consumer confidence numbers. They dipped two points to -33 for November. Also, three further key measures fell in comparison to the previous index on 23 October, and two were unchanged.

But the standout bad news came as the index measuring changes in personal finances was particularly harsh. While the reading covering the last 12 months fell seven points to -16 (16 points lower than November 2019), the forecast for personal finances over the next 12 months is down five points this month at -5, six points lower than November 2019.

Joe Staton, Client Strategy director for GfK, said: “People are clearly losing their nerve regarding their personal finances with scores for the last 12 months and the year to come sharply down. This will deal a blow to any future rebound because bullish consumer spending fuels the UK economy and low confidence is the enemy of recovery”.

Staton added: “The second lockdown couldn’t have come at a worse time for the UK’s high-street retailers and it’s no surprise that our major purchase sub-measure is once again mired deep in negative territory. On all fronts, economic headwinds still outnumber tailwinds sadly and consumers can be excused for showing little in the way of Christmas cheer.”

Meanwhile, the measure for the general economic situation of the country during the last 12 months is unchanged at -67, still 33 points lower than in November 2019. Expectations for the general economic situation over the coming 12 months are also the same as last month at -50, some 16 points lower than 12 months ago.

The Major Purchase Index fell one point to -28 in November, some 28 points lower than it was in November 2019. The Savings Index also dropped three points to +11 in November, seven points lower than this time last year.