Consumer Confidence Falls Further Even As Spending Edges Up

Consumer confidence in the UK remains under sustained pressure, with the latest data from the British Retail Consortium indicating that sentiment around both the economy and personal finances has reached record lows.

Figures compiled with Opinium show that expectations for the state of the economy held at negative fifty three in April, matching March but remaining the lowest level recorded. Confidence in personal financial situations declined further to negative twenty one, also marking a new low.

The data points to a widening disconnect between sentiment and behaviour. While confidence has deteriorated, expected spending has moved in the opposite direction. Anticipated retail spending rose to plus five, while overall spending expectations increased to plus fifteen. However, this shift is narrowly driven. Growth is concentrated within grocery, with households continuing to cut back across discretionary categories.

Helen Dickinson, Chief Executive of the British Retail Consortium, points to the broader pressures shaping this pattern. Ongoing geopolitical instability, particularly in the Middle East, continues to influence expectations around inflation and living costs. Rising prices across energy, fuel, and food are expected to weigh further on household finances, reinforcing a cautious approach to non essential spending.

At the same time, businesses are facing their own constraints. Higher operating costs, combined with increasing regulatory and policy pressures, are limiting flexibility. Measures such as packaging taxes and changes to employment and health regulations are adding to the burden at a time when margins are already under strain.

What emerges is a market operating under tension. Consumers expect their financial position to weaken, yet are bringing forward spending in anticipation of further price increases. This behaviour reflects a defensive response rather than renewed confidence.

Melissa Minkow, Director of Retail Strategy at CI&T, summarises the shift:

“The BRC data shows that economic sentiment is no longer a reliable correlate to spend. Shoppers are pre-empting an increase in bills and spending, predominantly triggered by macro-economic factors and the resulting volatility.

This moment is a key example of how retailers and consumers are on the same team. Retailers should always use real-time data to provide the best prices to consumers while maintaining profitability, but this ability is especially crucial during these uncertain times.”

The challenge for retailers is clear. Pricing, inventory, and demand forecasting must now operate in an environment where sentiment no longer predicts behaviour with any consistency. For policymakers, the data reinforces the urgency of stabilising cost pressures before further erosion of confidence feeds into broader economic slowdown.

For now, the direction is set. Confidence remains low, spending remains selective, and both consumers and businesses are navigating a landscape defined more by uncertainty than recovery.