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UK Household Confidence Falls to Three-Month Low

Rising job insecurity driven by energy-price shocks has left families cutting spending and bracing for Bank of England rate rises ahead of the autumn Budget.

Overview

  • The S&P Global UK consumer sentiment index slipped to 42.7 in September, a three-month low that signals broad negative household sentiment below the 50.0 threshold.
  • Job-security fears rose to their weakest level in about three-and-a-half years for workers outside IT and telecoms, with retail staff reporting the greatest concern.
  • Around 53% of survey respondents now expect the Bank of England to raise interest rates, reflecting the Bank’s warning that energy-driven inflation makes the case for hikes stronger.
  • Households are cutting big-ticket purchases, running down savings and relying more on credit as higher energy bills and job worries squeeze budgets.
  • The September results build on reports of roughly 200,000 job cuts since the new government took office and add pressure ahead of the autumn Budget and likely fiscal choices.