The parlous state of household budgets was laid bare by two influential surveys of the UK consumer yesterday. The main consumer confidence index fell by five points to a negative reading of 30 this month, with the biggest fall being in people's expectations for the UK economy's performance over the next 12 months, according to GfK NOP.
The high street was also weaker than expected, with 33 per cent of chains delivering a rise in sales volumes between 28 June and 19 July, but 38 per cent suffering a fall, according to the CBI Distributive Trades Survey. The net balance of minus five was the weakest retail sales since June 2010.
Nick Moon, the managing director of GfK NOP Social Research, said: "Consumer confidence has shown the second major fall in a row, returning to the depths of the first quarter of this year. It's becoming clear that May's positive surge was the exception rather than the norm, as we return to minus 30 – wiping out almost all of May's rise. Before this year, the index has only twice been lower in its 37-year history: during the recessions of early 1990 and mid-2008."
According to the CBI, grocers suffered their first fall in sales for 30 months, but the picture was far worse for those selling DIY, footwear and durable household goods.