UK consumer confidence fell for the first time in six months, interrupting a rapid rebound in sentiment as the reality of soaring prices emerged as a threat to household finances.
(Bloomberg) — UK consumer confidence fell for the first time in six months, interrupting a rapid rebound in sentiment as the reality of soaring prices emerged as a threat to household finances.
The market research firm GfK Ltd. said its reading of confidence fell 6 points to minus 30 in July, the sharpest drop in 15 months and the lowest reading since April. Economists had expected a shallower decline to minus 25.
Rising interest rates along with inflation that’s lingering at almost four times the Bank of England’s 2% target are cutting into spending power for consumers. That may signal a softening for the economy in the months ahead.
“Reality has started to bite and, as people continue to struggle to make ends meet, consumers will pull back from spending,” Joe Staton, GfK’s client strategy director, said. “It’s bad news. People are feeling economic pain.”
GfK’s data showed concerns about personal finances and the general economic situation, with confidence levels decreasing over the last year and expectations that the trend will continue.
A separate survey from the Recruitment and Employment Confederation showed that the number of job postings is still increasing despite a dimming outlook for the economy.
REC listed 2.2 million active job postings in the week ending July 9, a 53.3% above the same week a year ago, with new job postings up 8.6% in the same period.
“Firms are still struggling to fill roles,” said Neil Carberry, chief executive officer of REC.
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