The latest Nationwide Consumer Confidence Index shows a big drop in confidence in March. Its headline index fell 8 points to 75 mainly reflecting weaker job sentiment. In the GfK March Consumer Confidence Barometer confidence also fell, down 1 point to 15.
Both the Nationwide Present Situations sub-index (down 3 points to 24) and Expected Situations sub-index (down 12 points to 109) fell in the month, with the employment component of each driving the index down.
As in the GfK March CCB, fewer people feel there will be more jobs available in the coming months the net balance of people expecting not many/few jobs to be available fell 9 points from 12 to 21%. In the current measure of job availability, the net balance of people believing there are many/some jobs available is 43%, down from 31% in February and only a little higher than a year ago, when the economy was in the depth of the recession.
Optimism about the economic outlook has fallen back this month but still is at historically high levels despite the post-election need for tax rises and spending cuts.
The Nationwide Spending sub-index is unchanged on the month at 102 well above its long-term average although the 3-month moving average of both underlying spending indices is lower. With the removal of some of the stimulus measures for car and house purchase and the increase in VAT, the index for making major big-ticket purchases has weakened in the quarter. A similar decline is found in the index for major household good purchases, and is also reflected in a weakening GfK spending climate measure on household goods.
In the recently published JGFR Financial Activity Bulletin, borrowing intentions are very weak especially for house and car purchase - reflecting consumers preference for saving and debt repayment as well as the availability of credit. The outlook for retailers and estate agents continues to be challenging.
John Gilbert, Chief Executive JGFR comments:
With the election campaign now well under way the main impact on consumers may well be to increase uncertainty rather than optimism as the prospect of a hung Parliament grows with no party able to establish a clear message capturing the consumer mood
To help understand the consumer mood in more detail JGFR produces the following:
· UK Consumer Confidence Monitor monthly
· UK High Earners Confidence Monitor monthly
· UK Regional Monitor quarterly
· UK Financial Activity Bulletin quarterly
· UK High Earners Financial Activity quarterly
We also produce a regular Financial Wellbeing Index, Optimism Index and Misery Index. For details contact firstname.lastname@example.org or ring 0208 944 7510 to discuss your consumer intelligence needs. We can also undertake bespoke research assignments.