Brits are saving their cash as worries over never-ending inflation continue to haunt consumer confidence ahead of the coming autumn budget, according to a closely watched survey out this morning.
GfK’s long-running consumer confidence index dipped by one point to –19 in July, with sentiment over the general economic situation over the past 12 months and for the coming year both also down by one point.
However, the savings index jumped by seven points to +34 in July, indicating consumers might be saving up for a coming rainy day.
“The key measures on personal finances, the economy and purchase intentions are flat in July, and many will conclude that consumers are in a cautious wait-and-see mood,” said Neil Bellamy, consumer insights director at GfK.
“But the data suggests some people may be sensing stormy conditions ahead. With speculation growing over possible tax rises in the autumn budget, and price pressure contributing not just to higher inflation already but also to the likelihood of worse inflation to come, the news is worrying.
“Our savings index is significant this month because it does indeed suggest people are anxious.”
Bellamy added it was difficult to know what would lift the overall consumer confidence score, which has been drifting downwards over the past year.
“Any fresh challenges or shocks could easily push confidence sharply lower.”
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