Consumer confidence in personal financial situations slumped in August, driven by the increasing uncertainty caused by Brexit.
A measure recording changes in personal finances during the last 12 months fell by two points this month to -1, a decline of five points compared to August last year.
Read more: UK consumer confidence slumps in June
The forecast for the next 12 months decreased by five points to a score of two in August, according to the latest consumer confidence index by GfK.
The survey found that confidence in the UK economy over the next year had fallen six points to -38, a decline of 26 points year-on-year, as Brexit uncertainty continued to reign in the build up to the 31 October departure date.
Joe Staton, client strategy director at GfK, said: “Until Brexit leaves the front pages, whenever that will be, consumers can be forgiven for feeling nervous, not just about the wider economy but also about their financial situation.
“That’s an important distinction because a significant development in August is the sudden drop in views on personal finances ‘over the next 12 months’ after the encouraging jump in this measure last month.”
The overall index score for August was -14 as all five measures decreased during the month.
If there is a continuation of the dip in personal finance confidence the headline score could crash towards the “worrying figures seen in the worst days of the financial crisis,” Staton warned.
“We are not there yet, and we may not necessarily get there, but it is a trend we need to watch carefully,” he said.
Yesterday analysis from Yougov and the Centre for Economics and Business Research showed that 56 per cent of British people think the economy will be in a recession this time next year.
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