British households’ confidence about their financial outlook fell last month to its lowest in more than eight years as inflation soared and people felt less secure about their jobs, according to a survey published on Wednesday.
Polling company YouGov and economic consultancy Cebr’s index of households’ expectations for their financial situation in 12 months’ time dropped by 4.5 points from December to 79.1, the lowest since October 2013.
YouGov/Cebr’s wider measure of consumer confidence, which also includes house values and business activity, fell in January to 109.0 points from 110.0, its weakest since last March.
“This month’s drop in the YouGov/Cebr Consumer Confidence Index highlights the impact of the rising cost of living on household sentiment,” said Sam Miley, senior economist at Cebr.
Consumer price inflation in December hit an almost 30-year high of 5.4% and last week the Bank of England said it looks likely to peak at around 7.25% in April.
The fall in the headline index was limited by a rise in its house price component to the highest since September 2014.
Miley said the survey’s reading for household finances was “particularly stark” and he cited plans to raise taxes on working people as another reason why people were feeling strain on their budget.
Other measures of consumer confidence from GfK and Bank of America have also declined recently.