UK: Consumer Fears Worst in 26 Years

Consumer sentiment in the UK is pretty much on the same low footing as in the US. Our consumer sentiment hit the lowest level since May 1980. But the UK housing recession started after ours. Does that mean the Brits face up to reality faster than we do, or could their economy be on a steeper downslope than ours?

From the Times:

Families are more fearful about their financial future than during the depths of the last recession, as they struggle with soaring food and fuel costs.

The drop in confidence, highlighted in new monthly figures, threatens to exacerbate Britain’s economic woes as hard-pressed consumers curb their spending, further undermining economic growth. Last week’s revised figures found that the pace of growth halved to 0.3 per cent, the lowest level for three years….

A new survey from Lloyds TSB also shows that people are more worried about losing their job than at any point in the past three years, as employers feel the effects of the downturn and may have to lay off staff.

The monthly poll of consumer sentiment found that householders’ confidence about future economic prospects had sunk to its lowest level since 1982. Confidence in existing economic conditions dropped during June to levels not seen since late 1992, at the end of the last recession…

The GfK NOP poll — based on people’s views on their own finances as well as wider economic conditions — found that the overall confidence index sank by five points this month to a reading of minus 34, on a par with the lowest level since the poll began in 1974. The record low of minus 35 was reached in March 1990, immediately before the start of the last recession….

Willingness to make “big ticket” purchases has also fallen to a record low. Figures published last week showed that families suffered the steepest decline in disposable incomes for nearly a decade during the first three months of the year.

The proportion of income being saved has fallen to the lowest level since 1959.