Consumer confidence hit further as debt worries grow

13 October 2008

Consumer confidence in September fell to its lowest levels in at least four years, as the threat of an economic downturn becomes an ever more realistic possibility, a survey has shown.

Nationwide Building Society’s Consumer Confidence Index (CCI) fell a further three points from 53 in August to just 50 in September – the lowest level since it began in 2004. By comparison, this figure was 95 points in September 2007, a point widely considered to be the peak of the previous economic boom.

However, the survey did show that 44% of consumers feel that the economy ‘will be the same or better’ in six months’ time (up from 39% the previous month), even though 48% believed not many jobs would be available in six months’ time.

A spokesperson for Think Money said: “People are worried at the moment – about their jobs, about their living costs and about the possibility of falling into debt.

“It is important that consumers avoid over-reacting to today’s negative economic news – many economists believe that a lack of consumer confidence could lead to something of a self-fulfilling prophecy, in which the economy could suffer because people are unwilling to spend money.

“And it’s also important that anyone struggling with debt tackles the problem now, as outstanding debts could become even more of a burden if the economy does deteriorate.”

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