Consumer confidence ‘severely depressed’ as families sit on their cash

Consumer confidence remains “severely depressed” with households saving more money ahead of the next stage in the coronavirus crisis, according to an index.

The overall index score for data analysis business GfK’s UK consumer confidence index between April 20 and 26 was minus 33 – just six points above a low of minus 39 in July 2008.

This was a point above the minus 32 score recorded earlier in April as part of a survey of more than 2,000 people.

They were asked how they feel about their personal financial situation, the wider economy and their attitude towards making major purchases.

While perceptions were negative during the latest period, people appeared to have become slightly less downbeat about their expectations for their personal finances in 12 months’ time.

A score of minus 11 was recorded on this measure, compared with a more negative score of minus 14 when the last survey took place.

The lowest score on this measure was in March, at minus 17.

Perceptions about the general economic situation over the past 12 months continued to decline between the first half and second half of April, with the score on this measure deteriorating from minus 44 to minus 48.

Joe Staton, GfK’s client strategy director, said: “Despite a one-point improvement in our second Covid-19 flash report at minus 33, consumer confidence in Britain’s lockdown economy is still severely depressed.

“However, we are recording small improvements in our personal finances and the wider economic picture for the next 12 months, key indicators when gauging optimism for our path to recovery.”

He added there was an uptick on GfK’s Major Purchase Index, with a three-point increase – a sign of a possible indication of pent-up demand.

Mr Staton said: “But in contrast to this, the nine-point spike in the Savings Index suggests cautious consumers are stashing money under the mattress over worries for the future.”