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UK consumer confidence enters uncharted water as Brexit negotiations stumble to conclusion

UK consumer confidence is navigating uncharted waters in the countdown to Brexit, according to two longstanding measures.

Shoppers are “stoic amid fear of the unknown” according to the GfK Consumer Confidence Index. “Despite a slowdown in overall growth and concerns about the impact of Brexit uncertainty on the UK economy, topline consumer confidence is stable again this month. Although bumping along in negative territory, the Overall Index Score is not showing any sign of making the dramatic drop seen after the June 2016 Brexit Referendum or in the early days of the last financial downturn,” says GfK client strategy director Joe Staton.

Staton describes consumers as having a marginally positive view on their personal finances, but a continuing depressed sentiment towards the general economic situation, that he says may point towards a “calm before the storm of post-Brexit headwinds… But it is frankly amazing that confidence is so stoic in a world of sharp political instability and fear of the unknown.”

Meanwhile GlobalData’s has recorded a slump in consumer confidence as Brexit negotiations stumble towards a conclusion. The analyst’s present sentiment index fell to +0.6, its lowest level since its inception in March 2013, as consumers grow increasingly sure of what Brexit will mean for them. The measure, which captures views on areas such as affordability of discretionary spend or whether it is a good time to make major purchases, looks set to fall into negative territory later this month.

“With parliament unable to agree on a plan for after 29 March – when the UK is scheduled to exit the EU – consumers are shunning discretionary spend, concerned regarding the affordability of essential products and anxious about job security,” says GlobalData research analyst Zoe Mills.

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