–UK Nationwide Jan Consumer Confidence 47 Vs 54 In Dec
–UK Nationwide Jan Spending Index 70 vs 90 in Dec
–UK Nationwide Jan Spending Index Lowest Since Nov 2008

LONDON (MNI) – After bouncing in December, UK consumer confidence
dropped straight back down in January, with consumers attitude to
spending at their most negative for more than two years.

The January hike in value added tax, coupled with consumers taking
an increasingly gloomy view of the economic outlook, appears to be
taking its toll.

The Nationwide January Consumer Confidence Index fell to 47 from 54
in December, taking it back to just one point above its low of 46 in
November.

The most striking move came in the spending index, which fell to 70
from 90 in December, taking it to its lowest point since November 2008.

Consumers were downbeat about the economy. In all, 67% said the
current economic situation was bad with 63% saying not many jobs were
available.

Looking six months ahead there was some improvement, with 58%
saying not many jobs would be available and only 36% saying the economy
would be bad, although 44% said it would be neither good nor bad and
just 17% said it would be good, down from 21% saying it would be good in
the December survey.

Academic research, including work from the National Institute of
Economic and Social Research, has found no close fit between confidence
surveys and consumer behaviour.

The surveys do, however, suggest consumers’ confidence is being hit
by the fiscal squeeze and rising inflation.

“Household confidence remained in the doldrums in January, with the
main index falling towards the all time lows recorded during the
recession,” Robert Gardner, Nationwide’s chief economist, said.

“The fact that the index fell during the month is not surprising,
when we consider the influences that will have impacted on consumer
sentiment during the survey field dates. Consumer perceptions are likely
to have been dented by the rise in VAT and the upward pressure on
inflation more generally,” he added.

The January Nationwide consumer confidence survey was conducted by
TNS-RI between Dec 20 and Jan 23 with 1,000 people.

–London newsroom: 4420 7862 7491 email: drobinson@marketnews.com

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