Consumer concerns over the economy continue to loom as Christmas draws near, with many worried about financial prospects ahead of the holidays.
- A recent survey by the British Retail Consortium indicates a slight improvement in consumer expectations for personal finances, yet worries about the broader economy have intensified.
- Retail spending intentions have shown a minor uptick, offering a glimmer of hope amid prevailing economic uncertainty.
- Despite stable levels in personal spending and savings, economic outlook perceptions have worsened, reflecting growing unease.
- Retailers face increased pressure due to impending costs and urge government action to alleviate business rates.
As the festive season approaches, consumer sentiment towards the economy remains tepid, according to the British Retail Consortium’s latest survey. The survey, conducted in mid-November, reveals a cautious outlook among consumers regarding their personal financial situations over the next three months. Expectations have slightly improved, moving from -4 in October to -3 in November, signaling marginal optimism.
Personal spending plans on retail goods have also experienced a minor rise, increasing to a score of 3 from the previous month’s 2. Despite this, consumer outlook for the economy has deteriorated, with the economic expectation index declining to -19 from -17. This suggests a growing concern about broader economic conditions as the year ends.
Helen Dickinson, CEO of the BRC, noted the lack of substantial movement in consumer confidence post-Budget, emphasizing that economic worries persist as Christmas nears. She stated, ‘There was little shift in consumer confidence since the Chancellor’s Budget, with many worried about the economy in the lead up to Christmas.’
Retailers are bracing for significant challenges ahead, with over £7 billion in additional costs anticipated in 2025 due to the Budget. This could potentially lead to increased pricing or reduced investment in retail jobs and infrastructure.
In response to these financial pressures, nearly 80 retail leaders have called upon the government to address business rate reforms planned for 2026, seeking meaningful reductions in retail costs to avert inevitable job losses and price hikes.
The looming economic concerns cast a shadow on holiday consumer confidence, with slight improvements in personal finance expectations overshadowed by broader economic apprehension.
