Consumer confidence stumbles in the face of uncertainty
UK consumer confidence fell in the first three months of 2016, according to the latest Consumer Tracker from Deloitte. The quarterly survey of 3,000 UK consumers reveals a renewed caution in the consumer sector, after confidence fell by three percentage points year-on-year in Q1 2016.
The Deloitte Consumer Tracker Q1 2016
Consumer confidence pauses due to wider uncertainty
The latest Deloitte Consumer Tracker shows a degree of caution returning to the sector as confidence falls.
Health and wellbeing drives fall in confidence
Five of the six confidence measures fell this quarter compared to the same time last year, driven mainly by a low sentiment level around health and wellbeing.
This fall comes at a time of growing awareness around health and healthcare related issues, the late arrival of the flu season and the growing use of health and fitness wearables and apps.
Confidence among Londoners and non-homeowners nationally falls
The gap between the confidence of homeowners and non-homeowners is now at its widest point since our survey began. While confidence among those who own their own homes remained flat, non-homeowners reported a four point fall from the previous quarter.
Consumers in London were also significantly less confident than in other regions, with Londoners’ confidence falling in terms of job security and disposable income.
Consumer spending remains robust
Most consumers continue to spend more on essentials; the majority have reduced spending on small and big ticket discretionary items in the seasonal downturn following Christmas. More consumers are now adopting expansionary behaviours and fewer are being defensive in their spending compared to this time last year.
How long will consumers' positive outlook last?
Despite consumer-focused economic fundamentals remaining strong, such as low unemployment and low inflation, consumers are clearly influenced by lower UK economic growth projections.
Our survey highlights that consumers are still relatively upbeat about their own finances; the question is how long this will remain the case, as consumers show signs of being aware of these headwinds.