Survey showing people are unwilling to make major purchases is latest blow to the government
Consumer confidence remains in the doldrums after failing to recover significantly after its biggest monthly drop in nearly 20 years, a survey published on Thursday revealed.
Confidence stood at minus 28 in March in the latest survey by GfK NOP Social Research which said it "stagnated at depths seldom seen outside of actual recession".
The reading saw an "astonishing" eight-point drop in January to minus 29, the biggest monthly fall since the 1992 recession, and it has now stayed at its current level for the last two months.
The poll is the latest blow to the UK economic recovery after official figures revealed household disposable income dropped for the first time in 30 years at the end of 2010, as pay failed to keep up with soaring inflation.
Nick Moon, managing director of GfK NOP Social Research, said: "This month's figures show how badly some form of stimulus is needed. The last time it was this consistently low was two years ago and, before then, in autumn 1990."
Consumers were increasingly gloomy about their own situation, with people's ratings of their own personal finances over the last 12 months falling four points since a year ago, while expectations for their wealth over the next year fell 14 points.
People's willingness to make major purchases also dived 12 points since a year ago, as consumers either could not afford to splash out on big ticket items or decided it was better to squirrel their money away.
Hopefulness as to how the economy will perform over the next year increased two points since last month but is still down 29 points since last year.
Chancellor George Osborne last week announced measures in his budget designed to stimulate growth including scrapping a rise in fuel duty and an increase in people's tax free allowances.
Moon added: "Next month's figures will reveal whether the budget really did put fuel in the tank of the economy ? or merely poured more cold water on people's personal finances."
Source: http://www.guardian.co.uk/business/2011/mar/31/consumers-remain-pessimistic-about-economy
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