Falling consumer confidence due to concerns over the Autumn budget and inflation rates
In a concerning development, the confidence of millennials in the UK economy has taken a significant hit in September, marking the fourth consecutive month of deterioration. According to recent reports, expectations for the overall economy worsened significantly among this demographic, leading to a cut in spending expectations for the months ahead.
The British Retail Consortium (BRC) reported that expectations of the overall economy worsened to -36 in September, down from -32 in August. This decline suggests a growing unease among millennials about the state of the UK economy.
The slump in consumer confidence is not surprising given the current economic climate. Inflation, driven by high food and services prices, remains a major concern. In August, inflation remained at 3.8%, and core food price inflation was 5.1% over the 12-month period, marking the fifth consecutive rise for the figure.
These inflation rates have cast doubt on the Bank's likelihood to cut interest rates, as they currently stand at 1.25%. Danni Hewson, a financial analyst, expects inflation to continue rising in the near term.
The unaffordability of property is another issue that millennials, who are between 29 and 44 years old, are facing. Labour's housebuilding plans have yet to filter through into the market, leaving many millennials struggling to afford homes.
Mortgage rates have also fallen slower than anticipated at the start of the year for this demographic, further exacerbating the issue.
The Budget and the increase in the cost of living have also eroded consumer confidence, according to Helen Dickinson, chief executive of the BRC. Personal spending fell slightly to +14 in September, down from +15 in August, and Brits' personal financial situations also slipped to -7 in September, down from -6 in August.
All eyes are now focused on the 26th of November, waiting for the Chancellor's announcement. With the economic outlook looking uncertain, it remains to be seen how the government will address these concerns and help boost consumer confidence.
Read also:
- Potential Consequences of Dismantling FEMA Vary Across States
- Railway line in Bavaria threatened by unstable slope - extensive construction site at risk
- Wind Farm Controversy on the Boundary of Laois and Kilkenny
- Puerto Rico's Climate Lawfare Campaign experiences another setback with the dismissal of its deals.
