British consumer confidence slumps to record low

The country’s major purchase index is in freefall as food and energy costs weigh on households

Consumer sentiment in the UK fell to record lows in August as the cost-of-living crisis continued to deepen, and inflation hit a four-decade high.

British consumer confidence declined to minus 44 in August from minus 41 in July, the lowest level since the survey began in 1974, data tracked by research firm GfK shows.

Sentiment has been falling steadily throughout 2022, and declined by a further three points in August. A year ago it stood at minus 8.

“A sense of exasperation about the UK’s economy is the biggest driver of these findings. Our sub-measure on the general economy over the past year has decreased month-on-month since December 2021,” GfK client strategy director Joe Staton said.

According to Staton, all five measures included in the index, which tracks changes in personal finances over the preceding 12 months, plunged this month, reflecting mounting concerns over the cost of living crisis. The major purchase index reportedly slid by four points in August.

READ MORE: UK inflation smashes 40-year high

In July, UK consumer price inflation surged to 10.1% per annum, smashing a 40-year high as spiraling food and energy prices continued to intensify the historic squeeze on households.

“With headline after headline revealing record inflation eroding household buying power, the strain on the personal finances of many in the UK is alarming,” Staton said.