Confidence in the UK’s economy fell to its lowest level since January 2018, with 36% of the British population claiming to feel optimistic about the current economic climate, the latest Lloyds Bank Spending Power Report revealed.
According to the report, over half (54%) of the UK displayed pessimism towards current levels of inflation, while an even higher percentage (60%) reported having a “dim view” on the current UK housing market.
Despite confidence in the economy being low, confidence in personal finances is nearing the highest ever recorded levels. Almost two thirds (65%) of Brits feel positive about their current financial position, which is just 3% lower than the September 2018 high.
According to the study, over four in five (82%) feel secure in their job, while 78% are happy with their level of disposable income.
Furthermore, Lloyds found that 23% of people believe they will have more disposable income in six months’ time, with 43% planning to enjoy that money, 72% planning to save it and 47% plan to pay off existing debt.
Commenting on the figures, Lloyds Bank managing director Robin Bulloch said: “While it is not the first time we have reported the resilience of people’s personal finances it has never been set against a backdrop of such heightened economic uncertainty.
“It’s really positive to see that people are able to feel confident in their own finances. At times like this, managing your money smartly remains key.”
However, Lloyds acknowledged that the figures certainly reflected a perceived uncertain economic environment for many, but they are “some way off” the lowest record figures set in 2011.
“In March of that year just 7% were confident in the UK economy (vs 36% in December 2018). Positivity towards inflation dipped to its lowest point in October 2011 to 9% (vs 46% in December 2018), and the following month saw 16% confident in the UK housing market (vs 40% in December 2018),” the bank said.
There is further disparity between homeowners and renters, with 51% of those that own their home feeling positive about the current level of inflation against just 37% of renters. The report highlighted that homeowners are also more confident in the UK’s employment position (68% vs 48%), the UK’s financial situation (39% vs 31%) and the UK’s housing market (47% vs 30%).
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