U.K.'s Recent Gains in Consumer Confidence Could Soon Hit Wall

Dow Jones
Sep 25

1049 GMT - A change in Prime Minister, combined with a boost to consumer spending from the summer's hot weather, has helped drive three straight monthly increases in U.K. consumer confidence for the first time since summer 2024, MHA's Joe Nellis says. The consumer sentiment index edged up to minus 13 in September, from minus 14 in August. However, recent gains could come under threat amid rising inflation, higher borrowing costs and weaker job prospects, he says. Andy Burnham's first budget announcement next month could also dampen confidence. "The fiscal situation remains unsustainable and tax rises are inevitable," Nellis says. "Creating the conditions for a sustained improvement in consumer confidence--rather than a short-lived spike - will be a major challenge for the government," he adds.

 

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