UK consumer confidence falls 11 points ahead of budget
GfK records its largest monthly decline outside the pandemic since July 2016, as retailers enter the Christmas trading quarter and await next week’s budget.
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GfK records its largest monthly decline outside the pandemic since July 2016, as retailers enter the Christmas trading quarter and await next week’s budget.
UK consumer confidence fell from minus 13 in September to minus 24 in October 2026, according to data company GfK’s index, reported by the Guardian on October 23. The 11-point decline took confidence to a six-month low as retailers entered the Christmas trading quarter.
Outside the Covid pandemic, it was the largest monthly fall since July 2016, following the Brexit vote. The index measures consumer sentiment, rather than actual spending.
Analysis
Neil Bellamy, GfK’s consumer insights director, said persistent living-cost pressures appeared to have swept aside the early optimism seen after the appointment of a new UK prime minister during the summer. He said unresolved regional conflicts were contributing to domestic inflation, which stood at 3.5%.
Paul Dales, chief UK economist at Capital Economics, said rising fuel and utility prices, higher borrowing costs and fears of tax increases in the budget were taking a greater toll on households.
Separately, official figures reported by the Guardian showed that retail sales volumes—the amount bought rather than the money spent—fell in September. Dales noted that sales had risen in August and across the third quarter as a whole.
| Period or measure | Change |
|---|
S&P Global’s survey of 1,500 UK households records worsening current finances and weaker expectations ahead of the government’s Budget.
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| August, compared with July | +0.7%, revised from +0.5% |
| September, compared with August | −0.4% |
| Expected September monthly change | −0.1% |
| Third quarter, compared with the second quarter | +0.7% |
Dales said unusually mild weather had held back autumn and winter clothing sales, and that clothing stores and supermarkets could perform better in October. But he said the confidence decline supported Capital Economics’ forecast that consumer spending and gross domestic product—the economy’s output—would stop growing after adjustment for inflation in the fourth quarter of 2026 and the first quarter of 2027. That remains a forecast, not a measured outcome.
UK chancellor John Healey is due to deliver his first budget on Wednesday. Retailers will be watching whether its measures add to business costs or further weaken consumer sentiment as Christmas approaches.