The election is over, the economy is improving but consumers feel ‘less confident about the future’

Consumer confidence levels dropped back in May as consumer morale about the future declined despite the election of a new Government.

The overall Index figure dropped 3 points to 1 last month, with all the major metrics used to calculate the index declining.

Consumers’ feelings about their personal financial situation and the general economic situation over the next 12 months saw the most dramatic declines, at 4 points and 6 points respectively.

Nick Moon, managing director of social research at GfK, believes the score for the general economic situation is “worrying”. It now sits 12 points lower than it did in May 2014.

“In the short term, this suggests that despite rewarding them with a majority in the House of commons, the public are not too confident about economic life under the Conservatives.

“Another forward-looking measure – household finances in the coming 12 months – has also registered a noticeable drop from 7 last month to 3 for this month. There seems to be reduced confidence about the future generally,” says Moon.

Moon says the Index now appears to be “in statis”, having been 2 points either side of 0 for 10 of the last 13 months.

Propensity to buy also fell by 4 points, while people’s feelings about their personal financial situation and the economy overall over the past 12 months fell by 1 and 2 points respectively.

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