ISH consumers have not yet been convinced that the new Lib-Con coalition government will boost either the general economy or their own personal finances, the May consumer confidence survey from GfK NOP will show today.
The overall consumer confidence index dropped for a fourth consecutive month and fell by two points to -18, a similar level to when Northern Rock was nationalised.
Nick Moon, managing of GfK NOP Social Research, said: “These figures are clearly not good news for the coalition government, especially with mounting speculation about double dip recession. “
“With considerable cuts in public spending, plus higher taxes on the way, it is hard to see the confidence index improving significantly in the near future.”
He added: “Most worryingly, the biggest drops in the component parts of the index were in expectations for the next 12 months for the country as a whole and for consumers themselves.”
After climbing into positive territory last month, consumers’ expectations for their personal finances over the next 12 months fell back to -3. This is slightly lower than the index score in May 2009.
The sub-index measuring confidence in the general economic situation over the next year dropped sharply to -9 from -1. However, Britons are more optimistic about the economy over the past 12 months with the index recording -45, 34 points higher than this time last year.
Consumers are also trying to deleverage: fewer Britons think that now is a good climate in which to make a major purchase. Compared to May 2009, more consumers think that now is a good time to save money.