Consumers feeling poorer in July
Research from Lloyds Banking Group showed that following last month’s improvement and record high of 164, the overall index has fallen by three points, driven by falling confidence towards people’s personal financial situations and Britain’s employment situation.
However, despite a decline in sentiment in July, Lloyds Banking Group economic data shows continuing falls in essential spending compared to the same time last year.
The negative growth in essential spend stood at -1.1% in July, slightly higher than June (-1.2%). The slowing of falling spend on fuel which had been seen over recent months has started to pick up again (-7.2%), and falls in water bills (-1.2%) last month have continued.
In addition to this, the consumer research shows people who think they will have more money in six months’ time has increased from 17% in May, to 19% in June and now stands at 21% in July, reflecting a more stable future situation index which remains unchanged this month.
Empty nesters in particular express less confidence this month in the country’s financial situation (down 10 points), their personal financial situation (down 10 points) and the UK housing market (down 18 points).
At the same time, young singles feel significantly better about their personal financial situation (up 28 points), the country’s employment situation (up 32 points) and current levels of inflation (up 14 points).
Claire Garrod, head of personal current accounts at Lloyds Bank, said: “Spending power confidence dropped back in July but it may be no surprise to see current spending power pausing for breath.
“The summer can be an expensive time of the year with people putting money towards paying off holidays and many families facing significant sums to get their children ready to go back to school in the next few weeks.”