UK consumers turn gloomier as economy, finance worries grow - GfK

UK consumers turn gloomier as economy, finance worries grow - GfK
FILE PHOTO: A shopper pushes a trolley in a supermarket in London, Britain April 11, 2017. REUTERS/Neil Hall -
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LONDON (Reuters) – British consumers have turned gloomier about the economy and the outlook for their personal finances, according to a survey by market researchers GfK that adds to signs of a lacklustre second quarter for the economy.

The GfK consumer sentiment index – which has been negative since shortly before the June 2016 Brexit referendum – fell to -13 in June from May’s seven-month high of -10.

The reading was below the median forecast in a Reuters poll of economists of -11.

A measure of consumers’ willingness to make major purchases was its weakest since November.

Until now, solid demand from British households has kept the economy ticking over while many businesses have halted major investment until the terms of Britain’s departure from the European Union become clearer.

Separately, Lloyds Bank said its monthly Business Barometer rose in June to 13% from 10% as companies became slightly more optimistic about the outlook.

“While overall business confidence is still below the long-term average, it is encouraging to see a rise for the third time in four months since the low in February,” Hann-Ju Ho, economist at Lloyds Bank Commercial Banking, said.

Closely watched surveys of the manufacturing, construction and services sector from data firm IHS Markit are due next week.

The Bank of England has forecast zero growth in Britain’s economy in the April-June period, partly reflecting a rush in stockpiling by companies before the original Brexit deadline on March 29 which led to weaker output afterwards.

The GfK survey of 2,001 people was conducted from June 3 to June 14 and was carried out on behalf of the European Commission. The Lloyds survey of 1,200 companies was conducted between June 3 and June 18.

(Reporting by Andy Bruce; Editing by William Schomberg)

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