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UK Consumer Confidence Dips
UK consumer confidence has fallen to its lowest level this year (overall index -5, from -3 in July), according to the monthly consumer confidence barometer, published by GfK Martin Hamblin on behalf of the European Commission.
The drop follows another quarter point interest rate rise by the Bank of England. Four out of the five measures that contribute to the headline index score have decreased this month, most notably perceptions of the general economic situation over the last twelve months which is down 6 points to -24, although still up on last August's -29. Expectations for the next twelve months have fallen for the first time in three months to -17 from -14 in July.
The index for the major purchases climate, which rose 6 points in July to +11, has fallen back to +7, well down on the score for August 2003 which was +19. Monique Hellel, Finance Director at GfK Martin Hamblin, says the findings support recent media reports that the five rate rises since November are 'beginning to bite'.
Some measures are showing improvement, however. The perception of whether now is a good time to save has shown a small increase to +22 from +21 in July - much higher than August 2003 (-6). Perceptions of the development of personal finances over the last twelve months has improved by three points to +1 (from -2).
GfK Martin Hamblin interviewed 2003 individuals aged 16+ between 29 July and 17 August. Note that the company's name was changed (to put the GfK at the beginning instead of the end) on 2nd August 2004, and its web site is now at www.gfkmh.com
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