Consumer Confidence Is Decreasing
Posted on Jun 22 2008 | Tagged as: Finance
An increasing number of Consumers are becoming worried about their finances, according to a recent report.
In a recent study carried out by Gfk NOP, it was shown that the nation’s financial outlook has continued to get worse. The company announced that the overall index which measures British opinions on the economy reached -29 during the month of may. A figure such as this represents a fall of five points from the -24 returned in April and down from -2 which was noted last May.
The company’s index measuring consumers impression of their personal financial situation over the past year was shown to have fallen by three points to arrive at -11, the lowest it has been since December 1995. Meantime, predictions over how they will manage money over the forthcoming year is equally bleak. This index is at -4, a decline of 17 points from May 2007.
Due to such concerns about their personal finance situation, it is quite plausible that people are failing to meet demands on their spending such as credit cards, loans and domestic bills.
In addition, the measure used for tracking how the economy has fared overall for the previous 12 months sits at -58, sliding from -18 points compared to the study carried out at the same time last year, and the lowest figure recorded since 15 months ago. Furthermore, expectations about the country’s general financial situation is down to -39 points.
Research from Gfk NOP also indicated that the index measuring whether or not consumers think that now is a good time to make a considerable purchase has continued to slide. This figure currently sits at -32, a drop of eight points from last months data and 36 beneath the figure recorded for May 2007. The latest figure was also indicated to be the lowest score ever recorded since they began their research in the early 80s.
However, for those who are considering making a purchase, which could include a car or house, using low rate loans to fund such a purchase may be advisable.
And with people having such concerns about their financial situation, it is quite plausible to think that more people will want to think a little more towards putting cash away for the future. However, it would appear that this is not necessarily the case as the index tracking whether people think that now is currently a good time to plan for the future has fallen. Down by three over the month of May to stand at 25, the index stands ten points lower than during the corresponding period last year.
Rachael Joy, from GfK NOP’s consumer confidence team, said: “UK consumer confidence continues its slide and we are experiencing levels not recorded since 1990; we are at an incredible 27 points beneath where we were this time last year. Consumers’ confidence in the economy over the next year, plus a reluctance to make significant purchases, reflect the popular expectation of a recession – both these measures are at the lowest level recorded. The coming months may see even more of a fall in confidence, as rising inflation and dropping house prices make reigning in their monthly expenditure even more likely to the UK public”.
Those people with concerns about their ability to cope over the next year could be recommended to take out a low rate loan. By doing so, this may allow buyers to meet various constraints on their monthly expenditure at once, leaving them with just one affordable repayment to make each month. This might be of assistance to a large number of consumers after Michael Coogan, director general for the Council of Mortgage Lenders, expressed disappointment at the Bank of England’s decision to maintain interest rates last month. He claimed that although most consumers should be ok, the housing and mortgage markets will encounter problems over the course of 2008. Mr Coogan advised those worried about their ability to manage their money to contact their loans provider or a financial advisory service as soon as they can.
Mark Dawson writes for the Loan Arrangers. Where visitors can compare cheap loans online, and apply for debt consolidation loans at the best rates.
- Mark Dawson