What is happening to consumer confidence?
Today’s figures for consumer confidence and show that families are becoming more worried about the future. This month, the GfK NOP Consumer Confidence Index decreased by two points to minus 21. While people’s judgement of their personal financial situation over the past year was the same as last month, the other elements of the index were all worse. The question on how people judge their personal situation over the next 12 months produced a fall of five points, more than any other element of the overall index.
It’s interesting to look at the questions about how people judge the last 12 months and the next and see how they have changed:
|Nov 2010||Oct 2010||Nov 2009|
|Personal financial situation over the last 12 months||– 13||– 13||– 14|
|Personal financial situation over the next 12 months||– 7||– 2||+ 5|
|General economic situation over the last 12 months||– 46||– 43||– 59|
|General economic situation over the next 12 months||– 22||– 20||+ 3|
It’s important to note that people are still more optimistic about their personal situation than the economy generally and the negative ratings for the next 12 months continue to be lower than for the past 12 months. GfK NOP point to the volatility of these results and say that really we “need to be a further drop next month before we could definitely say things are getting worse, and that people really are concerned about the impact of the cuts in the Comprehensive Spending Review.”
But, they add, “what is more worrying in this month’s figures is that the worst-performing elements of the index are those that look to the future.” Indeed, if we look at the figures, a year ago there was a clear sense that consumers felt they had come through a terrible year but things were looking up. This year, fewer people judge the past year harshly, but more are worried about the future.