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UK client confidence fell this month to the bottom degree since late 2023 as increased inflation following the battle within the Center East induced “jitters” amongst households, darkening the outlook for spending and financial progress.
The GfK client confidence index — a measure of how folks view their private funds and broader financial prospects — dropped by 4 factors in April to minus 25, the analysis group stated on Thursday.
It was the third consecutive decline and the biggest month-on-month fall since April 2025, when Donald Trump announced his sweeping “liberation day” tariffs. It was additionally the bottom studying since October 2023, when banks’ mortgage charges have been near their current peak.
Neil Bellamy, client insights director at GfK, stated: “Customers actually do have the jitters now.”
He added: “Everyone seems to be grappling with fast value rises, particularly on the gas pumps, that are taking a dent out of family budgets, and folks know additional value hikes are coming.”
Unleaded petrol costs on the pump averaged 157.6 pence per litre within the week to April 20, up from 131.7 pence per litre in the identical week in February, in keeping with official information.
Expectations of upper inflation have put strain on mortgage charges as monetary markets value in that the Financial institution of England will elevate rates of interest this yr. On Thursday, the typical two-year fastened mortgage fee was 5.82 per cent, a fee that has stabilised over the previous few weeks, however is up from 4.83 per cent at first of March, in keeping with Moneyfacts.
Ashley Webb, economist on the consultancy Capital Economics, stated he now anticipated client spending to rise by 0.1 per cent in 2026, which is down from the 0.8 per cent he anticipated earlier than the battle, principally due to increased inflation.
Economists polled by Consensus Economics reduce their expectations for UK family consumption progress for this yr to solely 0.6 per cent in April, down from 1 per cent anticipated in February, earlier than the battle within the Center East.
Weak client spending would weigh on progress as family consumption accounts for greater than half of spending throughout the economy.
Ellie Henderson, economist on the financial institution Investec, famous that whereas fuel costs had risen nowhere close to the peaks reached within the aftermath of the Russian invasion, “the labour market is notably looser now than it was then, limiting client resilience”.
On Wednesday, official information confirmed that inflation rose to three.3 per cent in March, up from 3 per cent. Early in April, the consultancy Cornwall Perception projected a 13 per cent enhance in July to the UK power value cap, which dictates typical family payments, however down from the 20 per cent rise predicted in March following adjustments in power costs.
GfK reported that the most important declines have been in perceptions of the UK economic system, with an eight-point slide in views on the financial image over the previous 12 months to minus 51. There was additionally a six-point fall in expectation for the economic system within the yr forward, to minus 43.
Views on customers’ private monetary state of affairs additionally darkened, with the index monitoring the outlook for the yr forward falling 5 factors to minus 4, the bottom since October 2023.
The one measure that went up was monitoring saving intentions, up 5 factors to 32. That is “usually a sign that persons are involved about what lies forward, so those that can are constructing contingency funds,” stated Bellamy.
