Consumer confidence has taken a hit in November after rising earlier in the year, with concerns that it may continue to decline into 2025.
The S&P Global 海角视频 Consumer Sentiment Index (CSI) survey showed a decrease in overall confidence from 47.3 in October to 46.9 in November, with the neutral benchmark being 50, as reported by .
Chris Williamson, Chief Business Economist at S&P, commented on the situation: "ongoing pressure on household finances has resulted in squeezed spending, higher debt and lower savings".
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Although lower interest rates typically lead to increased borrowing and a sense of financial stability, Williamson noted that this hasn't been the case: "the fact that confidence fell in November despite the Bank of England cutting interest rates suggests lower borrowing costs alone may be insufficient to turn the tide and lift sentiment."
At the beginning of November, the Bank of England reduced interest rates by 25 basis points but indicated a "gradual" approach to further cuts as it assesses the Budget's impact on the economy.
Job security and overall economic outlook might overshadow national growth prospects.
Employment worries at the fore
Concerns about employment intensified as labour market sentiment hit a four-month low in November.
The budget did deliver a minimum wage hike, but it also augmented the tax burden on employers concerning their staff's wages, a move that numerous businesses caution could compel them to trim their workforce.
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Williamson expressed concern regarding potential strains on the labour market in the upcoming months, highlighting that job security is "showing signs of waning".
He articulated apprehensions about declining consumer confidence: "Any intensification of job worries, spurred perhaps the recent measures announced in the Budget, including higher employer National Insurance contributions, could result in a further loss of consumer confidence," Williamson remarked.
In communication coordinated by The British Retail Consortium (BRC), leaders within the retail sector pressed the Government with blunt warnings that job cuts were "inevitable" and increased prices a "certainty" following the budgets revelations.
Recruiters who had held hopes for an improved labour market by 2025 now predicate such optimism on a more supportive business environment and amplified business confidence.
It remains to be seen whether Britain's businesses will be able to absorb the steeper costs that have been imposed upon them.