This January brings an unwanted anniversary, marking a decade of gloomy confidence of British consumers, a retail expert has stated citing the latest consumer confidence figures from GfK.
According to GfK, consumer confidence rose by 1 point to -16 in January but continues to remain in negative.
Neil Bellamy, Consumer Insights Director at GfK, noted that this January brings an unwanted anniversary, marking a decade since consumer confidence was last in positive territory.
“Even with a one-point increase in headline confidence this month to -16, we remain a long way from consumers feeling that better days are around the corner,” he said.
“Yes, perceptions of personal finances have improved, but this is offset by growing concerns about the economy. We’ve seen this pattern before.
"During periods of political and economic uncertainty – most notably in late 2022 – consumers became more cautious but also more self-reliant. What we’re witnessing now is a return to that mindset: people feel they can manage their own finances, but they remain unconvinced about the wider economic outlook.
"Let’s be clear – this isn’t optimism; it’s resilience. Consumers are once again focusing on what they can control – their own spending and saving – while confidence in the wider economy remains low.”
He concluded, “To many consumers, the UK economy is beginning to resemble an untethered boat drifting slowly out to sea."
Meanwhile, Retail Sales Index, released by Office for National Statistics, showed sales up 4.9 per cent by value, and up 3.1 per cent by volume.
Harvir Dhillon, Economist at the British Retail Consortium, sais, “ONS retail sales figures show a fragmented market over Christmas, with larger retailers seeing sales drop 1.6% while smaller independents grew 6.4%. Food sales remained relatively stable, but this was owing to rising food inflation rather than increased sales.
"Typically popular Christmas gifting categories such as electricals, books and health and beauty saw sales drop as people tightened their purse strings. Shoppers are continuing to hold back spending as they manage the rising cost of living.
“This performance capped off a difficult year, where significant cost pressures have been weighing down on the industry. If these costs continue to climb, whether through higher business rates bills or higher costs of employment, then it will be ordinary workers who are most affected as more entry-level and flexible jobs disappear.
"This means more people tightening their belts, and less spending in the economy in future.”