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| Consumer confidence hits five-year low as Brexit uncertainty bites | Consumer confidence hits five-year low as Brexit uncertainty bites |
| (30 days later) | |
| Consumer confidence has slumped to a five-year low as Brexit uncertainty left shoppers fearing for the stability of the UK economy in the months ahead. | Consumer confidence has slumped to a five-year low as Brexit uncertainty left shoppers fearing for the stability of the UK economy in the months ahead. |
| The GfK index, which is used by the European commission to judge consumer confidence, fell to -14 in December, down from -13 in the previous month and -10 in October. | The GfK index, which is used by the European commission to judge consumer confidence, fell to -14 in December, down from -13 in the previous month and -10 in October. |
| The monthly monitor showed that most of the fall was fuelled by fears for the UK economy rather than consumers’ concerns about their personal finances. | The monthly monitor showed that most of the fall was fuelled by fears for the UK economy rather than consumers’ concerns about their personal finances. |
| However, Joe Staton, of GfK, said: “In the face of ever-rising costs, and the threat of higher inflation combined with uncertainty around the outcome of the Brexit negotiations, consumers are in a chilly mood of despondency and putting on a glum face when they look at the prospects for 2019.” | However, Joe Staton, of GfK, said: “In the face of ever-rising costs, and the threat of higher inflation combined with uncertainty around the outcome of the Brexit negotiations, consumers are in a chilly mood of despondency and putting on a glum face when they look at the prospects for 2019.” |
| The decline in confidence mirrored results from high street chains including Boots, which said underlying sales at its pharmacies slid 3.5% while retail sales were down 2.6% in the three months to end of November. | The decline in confidence mirrored results from high street chains including Boots, which said underlying sales at its pharmacies slid 3.5% while retail sales were down 2.6% in the three months to end of November. |
| The health and beauty chain’s owner, Walgreens Boots Alliance, blamed a “very weak retail environment” in the UK. It said profits fell by 2.5%, excluding the impact of exchange rate changes and exceptional items, including the sale of the chain’s manufacturing division. | The health and beauty chain’s owner, Walgreens Boots Alliance, blamed a “very weak retail environment” in the UK. It said profits fell by 2.5%, excluding the impact of exchange rate changes and exceptional items, including the sale of the chain’s manufacturing division. |
| Last week the Sports Direct founder, Mike Ashley, complained that retailers had experienced their worst November on record. | Last week the Sports Direct founder, Mike Ashley, complained that retailers had experienced their worst November on record. |
| However, official UK figures for November were more buoyant after reports from retailers of a bounce back in sales after declines in the previous two months. | However, official UK figures for November were more buoyant after reports from retailers of a bounce back in sales after declines in the previous two months. |
| The Office for National Statistics said heavy discounting by online retailers on Black Friday and Cyber Monday drove a sharp rise in sales of 4K TVs, laptops and high-end smartphones. | The Office for National Statistics said heavy discounting by online retailers on Black Friday and Cyber Monday drove a sharp rise in sales of 4K TVs, laptops and high-end smartphones. |
| The surge in online spending, which surprised the City after doom-laden reports by retailers, pushed the quantity of goods bought last month up by 1.4% compared with October. The annual increase hit 3.6%. | The surge in online spending, which surprised the City after doom-laden reports by retailers, pushed the quantity of goods bought last month up by 1.4% compared with October. The annual increase hit 3.6%. |
| Retail analysts said the reliance by the ONS on smaller retailers in its survey skewed the results. Nick Bubb, an independent analyst, said: “Yet again the ONS retail sales figures are grossly inflated by improbably good growth for ‘small businesses’. And yet again the ONS doesn’t think the divergence against the weak performance of ‘large businesses’ is worth commenting on.” | Retail analysts said the reliance by the ONS on smaller retailers in its survey skewed the results. Nick Bubb, an independent analyst, said: “Yet again the ONS retail sales figures are grossly inflated by improbably good growth for ‘small businesses’. And yet again the ONS doesn’t think the divergence against the weak performance of ‘large businesses’ is worth commenting on.” |
| Howard Archer, the chief economic adviser to the EY Item Club, said: “There are bound to be suspicions about the November data, given that the ONS has acknowledged that it is not easy to seasonally adjust for Black Friday data given the changing nature of promotions. | Howard Archer, the chief economic adviser to the EY Item Club, said: “There are bound to be suspicions about the November data, given that the ONS has acknowledged that it is not easy to seasonally adjust for Black Friday data given the changing nature of promotions. |
| “Furthermore, the underlying performance of retail sales still looks lacklustre, with volumes up a modest 0.4% in the three months to November compared to the three months to August.” | “Furthermore, the underlying performance of retail sales still looks lacklustre, with volumes up a modest 0.4% in the three months to November compared to the three months to August.” |
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