Consumer confidence low in June
New data has revealed that consumer confidence remained low in June as the run-up to the EU referendum made people more pessimistic about the economy.
GfK’s long-running Consumer Confidence Index shows that the main headline index stayed at -1 this month.
Joe Staton, head of market dynamics at GfK, said: “This month’s GfK Consumer Confidence Index is based on interviewing carried out in the first two weeks of the month, as is the case every month. So our current data – using interviews from between 1 June and 15 June – clearly does not yet provide insights into how the major impact of the EU Referendum result has changed consumer sentiment.
“Nevertheless, one trend that continued in the run up to the referendum is a deepening pessimism over the general economic situation. As we approached voting day, this was already 18 points lower than in June 2015 and it’s almost certain we’ll see this worsening when next month’s results are in.
“Before the referendum there was an uptick in confidence about personal finances, and as of mid-June this measure was more positive than 12 months ago. But once again it is difficult to see this holding up.”
While the index relating to the forecast for personal finances over the next 12 months rose by one point to 8 this month, the index measuring expectations for the general economic situation over the next 12 months has fallen by one point to -14. This is 18 points lower than in June 2015.
Meanwhile, the climate for major purchase index stayed the same this month at 9, seven points lower than this time last year.
Staton added: “In these extraordinary consumer circumstances, all bets are off until we all know more. We can expect plenty of volatility in consumer confidence at least until Brexit negotiations are underway. The longer term mood will then depend on how smoothly those negotiations go.”
