Consumer confidence dropped to only one point above its all time low during June, according to research by Gfk NOP.The Index has dropped to -34 following a five-point decline. The research suggests that consumer confidence in the UK economy has hit its new low, down 42 points on the same time last year.
At -34 it is only one point higher than the -35 recorded in March 1990 when the UK was heading into recession.
Rachael Joy in the Consumer Confidence team at GfK NOP commented: "With rising inflation, gloomy forecasts for interest rates and soaring fuel, utility and food prices dominating the front page headlines, it's no surprise that confidence in the general economy is almost in freefall. It seems unlikely that this trend will reverse in the near future”
In a second separate study, Ernst and Young has reported that disposable incomes have fallen to their lowest for five years.
The discretionary income for the average UK household is now just £772.79, as opposed to £909.84 during 2003-04.
Jason Gordon, director of retail at Ernst & Young, said: "All consumers are painfully aware of the huge hikes in petrol and utility bills but we've also seen some fairly hefty price increases in pension contributions and debt repayments. Worryingly, though, the worst could be yet to come."
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