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UK consumer confidence collapses after election

Staff Writer |
UK consumer confidence in June fell to its lowest level since the aftermath of the Brexit vote.

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This is according to the latest survey from YouGov and the Centre for Economics and Business Research.

The consumer confidence index showed a "pronounced collapse" following the general election as it fell from 109.1 in the week before the vote to 105.2 in the period after it, compared to a drop to 104.3 in the days after the Brexit vote last year from 111.9 in the weeks before.

Meanwhile, the overall consumer confidence index for the month fell to 106.9, marking its second-lowest level since the summer of 2013.

The drop in consumer confidence was driven by two specific factors: a sharp decline in optimism over property prices and the continuing slow puncture of people's household financial situations.

Stephen Harmston, head of YouGov reports, said: "Consumer confidence has been generally ticking downward since last autumn but the events of the past month have placed it under greater pressure.

"The hung parliament seems to have further dampened consumers' spirits, which were already sinking following the continued squeeze on household finances.

"But the real cause for alarm will be the cooling of the property market, as this is one of the key things that has propped up consumer confidence over the past few years."

Douglas McWilliams, deputy chairman at the CEBR, said: "It looks as though the indecisive result of the election has seriously affected economic prospects already dampened by Brexit uncertainty. The data shows a sharp drop in consumers' confidence about their own financial situation and even more so about house prices. This will affect spending in the high street, in shopping centres and online.

"Meanwhile business confidence is also likely to have dropped.

"Our preliminary assessment is that economic growth will fall sharply over the coming months and the country will only be saved from recession by strong international trade. We will be releasing our updated forecasts next week and they will show a significant downward revision."

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