UK consumer sentiment has taken a hit due to fears over the upcoming budget and government warnings. The British Retail Consortium reported a significant drop in households’ assessment of the general economic situation, with older generations particularly affected. Households are also more worried about their personal financial situation, with expectations for future retail spending decreasing. Despite this, some consumers expect to reduce the amount they save instead. The fall in consumer confidence is reflected in spending plans for the next three months, with certain sectors like fashion, home and garden furniture, DIY, and electronics expected to be hit harder. This comes in the wake of another report showing a slide in consumer optimism, as concerns grow over government plans for a “painful” budget.
Additionally, the European Bank for Reconstruction and Development has lowered its growth forecast for Ukraine due to Russian attacks on its energy infrastructure. This has forced Ukraine to rely on more expensive imports, impacting its energy-intensive industries. The EBRD warns that many countries in its lending region are facing challenges from high energy prices and a lack of investment, hindering growth prospects.
In other news, Elon Musk has not been invited to the UK’s International Investment Summit following controversial social media posts during the summer riots. Thames Water’s credit ratings have been downgraded, and the Swiss National Bank has cut interest rates. Overall, the economic landscape in the UK and Europe faces challenges as consumer sentiment wanes and external pressures take their toll on various industries.
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