Consumer confidence 'lowest for two-and-a-half years'

Friday, 28 October 2011 11:42

Consumer confidence is down to its lowest level since February 2009, one of the clearest indicators yet that Britain may be about to enter a new period of recession.

That is according to the latest Consumer Confidence Index from research firm GfK NOP, which was down to minus 32 in October from a level of minus 30 in September.

It is only the third time since the study began nearly 30 years ago that the index has gone this low and is significantly down on the figure of minus 19 this time last year.

Nick Moon, managing director of GfK NOP Social Research, commented: "At this point in time, consumers' outlook is becoming increasingly pessimistic about the UK's general economic situation over the coming year.

He added: "Additionally, the climate for major purchases has worsened, suggesting the government can't rely on people spending their way out of the double-dip recession that is likely to be on the horizon."

Consumer confidence has been squeezed this year by high inflation and low wage growth, alongside severe public spending cuts.

The Bank of England recently announced plans to inject £75 billion into the economy through the process known as quantitative easing, in a bid to boost growth.

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