Economic Gloom Dims Britain's Christmas Cheer
2024-12-13
Category: economic

By Joshua Kirby
The mood among U.K. consumers is just a little sunnier this month, suggesting household spending won't offer a major boost to growth at the end of the year.
Research group GfK's measure of consumer confidence climbed to minus 17 in December's survey from minus 18 in November. Consumers were less pessimistic about their personal financial situations and expressed a more positive view over their own prospects. But there was no improvement in feelings around the wider economy or ability to make major purchases. That constitutes a worrying sign for Britain's retailers, who will be hoping for a strong end-of-year shopping season.
"Consumers are still thinking twice about big-ticket purchases and whether they will bring Christmas cheer," GfK's Neil Bellamy said.
Confidence earlier this year recovered for the first time to the levels seen before the inflation crisis that began early in 2022 with the full-scale Russian invasion of Ukraine. But that recovery has proved elusive, despite rising real incomes among U.K. workers, with high interest rates and geopolitical uncertainty preventing a resurgence in the sort of economic optimism that drives consumers to spend rather than save. Concern around the direction of the economy is also worrying Britons, Bellamy said.
"In a nutshell, it's the continuing uncharitable view on the U.K.'s general economic situation that's suppressing consumer confidence," he said.
Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby