UK consumer confidence still in "doldrums" despite August rise - BRC

(Alliance News) - Consumer expectations for the next three months "crept up" early in August but remain down from a year before, the British Retail Consortium reported on Wednesday.

A BRC survey, conducted between August 5 and August 8 with responses from 2,000 UK adults, found that consumer expectations on the state of the economy improved slightly to minus 32 in August from minus 33 in July.

"While consumer confidence in the economy crept up this month, it remains 24 [points] lower than a year ago, with older generations seeing the biggest falls," commented BRC Chief Executive Helen Dickinson. "Full-time workers were far more optimistic than those working part-time, unemployed, or retirees, reflecting that they were also the only group who expected their financial position to improve in the next three months."

Consumer expectations for personal saving improved to positive 2 in August from minus 3 the prior month.

Sentiment on consumers' personal financial situations improved to minus 6 in August from minus 7 in July. For personal spending on retail, it edged higher to positive 4 from 3. For personal spending overall, expectations were unchanged on-month at positive 16.

"With prices rising, and food inflation predicted to hit 6% by the end of the year, households are expected to spend more on retail goods in the coming months, with groceries showing the biggest increase," Dickinson said. "Rising food inflation will make it harder to lift consumer confidence out of the doldrums...Consumers see rising prices, gap-toothed high streets, and reports of large businesses falling into administration.

"Much rides on the chancellor's plans for Retail, Hospitality and Leisure, and only a significant reduction in the business rates burden can bring about the levels of investment needed to reinvigorate Britain's high streets and town centres."

By Emma Curzon, Alliance News reporter

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