Consumer confidence hit by emergence of Omicron variant
Consumer confidence has declined in December as people worry about the impact of the Omicron Covid-19 variant on their personal finances and the wider economy.
According to GfK’s long running Consumer Confidence Index, it declined by one point to -15.
Joe Staton, client strategy director at GfK said: “News about the Omicron variant could not have arrived at a worse time for festive celebrations. As thoughts began turning to Christmas and the New Year, Omicron jumped out of nowhere and threatened to bring Santa’s sleigh crashing to a halt. While the holiday season has not yet been hijacked, December’s headline score has slipped one point to -15 and the lack of Yuletide cheer is evident.”
The index measuring the forecast for personal finances over the next 12 months has decreased by one point to +1 this month, which is two points lower than this time last year.
In addition, the index measuring expectations for the general economic situation over the coming year has dropped by one point to -24.
Staton added: “Both measures that look at how people see the coming year have slipped – down one point for personal finances over the next 12 months and down one point for the wider economy during 2022. This is driven by concerns over the soaring cost of living with the prospect of looming interest rate rises piling on more pressure.”
Meanwhile, GfK’s major purchase index has decreased by three points to -6 in December, but this is 16 points higher than it was in the same month last year.
Staton said: “Dispirited Brits say they are less inclined to make major purchases during the countdown to Christmas. We end 2021 on a depressing note and it looks like it will be a bleak midwinter for UK consumer confidence possibly with new Covid curbs and little likelihood of any real uplift in the first months of 2022.”
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