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UK consumer confidence slides to 11-month low ahead of Brexit

Economic IndicatorsNov 29, 2018 09:30AM ET
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© Reuters. A tree covered in autumn foliage is seen with office skyscrapers around it during rainfall in the City of London, Britain

By Andy Bruce

LONDON (Reuters) - British consumers' confidence fell to its lowest level in almost a year as their view of the economic outlook for the next 12 months sank to its weakest since shortly after 2016's Brexit vote, a survey showed on Thursday.

The GfK consumer sentiment index fell to -13 in November from -10 in October, the lowest reading since December 2017 and below economists' average forecast in a Reuters poll.

The market research company published the data earlier than its planned release time of 0001 GMT on Friday after the news was released early by an industry publication.

While spending from consumers fueled robust economic growth in mid-2018, helped by a hot summer and the soccer World Cup, GfK's report adds to signs the economy is slowing ahead of Britain's exit from the European Union in March next year.

Bank of England data earlier on Thursday showed the weakest consumer borrowing growth in more than three years.

Earlier this month Prime Minister Theresa May agreed a Brexit divorce deal in principle with the EU but she faces broad opposition from lawmakers in her own party and outside, which has shaken investors' confidence in Britain.

All the components in Thursday's survey dropped, including a steep fall in major purchase intentions -- something that bodes poorly for retailers in the run-up to the crucial Christmas holiday trading season.

Consumers' confidence in the economy over the next 12 months fell to its lowest level since shortly after the Brexit vote, one of the weakest readings since the global financial crisis.

"The next few weeks are highly unlikely to inject any festive cheer, especially if Theresa May's Brexit deal doesn't win backing from (lawmakers)," GfK client strategy director Joe Staton said.

Parliament is due to vote on the deal on Dec. 11.

GfK's survey of 2,003 Britons was conducted on behalf of the European Commission and took place between Nov. 1 and Nov. 15.

(The story was refiled to add dropped word seventh paragraph)

UK consumer confidence slides to 11-month low ahead of Brexit
 

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