Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
UK consumer confidence has been negative or flat for 10 years, underlining the impact of the Covid-19 pandemic, political upheaval and the cost of living crisis on Britons’ morale, according to a closely watched survey.
The GfK consumer confidence index — a measure of how people view their personal finances and broader economic prospects — rose by 1 point to minus 16 in January, the research group said on Friday.
Neil Bellamy, consumer insights director at GfK, said: “January 2026 brings an unwanted anniversary, marking 10 years since consumer confidence was last in positive territory.”
Even with a 1 point increase, “we remain a long way from consumers feeling that better days are around the corner,” he added.
January’s figure, based on a survey conducted in the first two weeks of the year, was up from a low of minus 23 in April 2025.
However, it was still lower than the near three-year high of minus 13 reached in July 2024, when Labour’s victory in the general election boosted morale. This was swiftly followed by a hit to sentiment amid rumours of a “painful” budget coming that autumn, particularly among older people.
Consumer confidence is closely watched as an early indicator of household spending, which has been very weak in the UK since the pandemic.
The index was last in positive territory in January 2016 when it was at four but plunged into double-digit negative figures following the Brexit referendum in June that year. Household sentiment about the economy and its outlook was dealt a further blow by the Covid-19 pandemic.
The cost of living crisis triggered another sharp decline in the assessment and outlook of personal finances, which both hit record lows in 2022 and 2023.
In January 2026, consumer outlook over personal finances rose 4 points to a positive score of six, with a similar improvement in their assessment of the past.
However, there was a 5-point drop to minus 45 in the assessment of the economy over the past year and a deterioration in the outlook.
“People feel they can manage their own finances, but they remain unconvinced about the wider economic outlook,” said Bellamy. “Consumers are once again focusing on what they can control — their own spending and saving — while confidence in the wider economy remains low.”
He added: “To many consumers, the UK economy is beginning to resemble an untethered boat drifting slowly out to sea.”
Wages continued to expand at a steady pace in the three months to November, but unemployment has risen from last year, while inflation accelerated to 3.4 per cent in December, according to official statistics published this week.
Ellie Henderson, an economist at Investec, had forecast some marginal improvement in confidence in January, largely because the November 2025 Budget was “not as bad as many feared”, with the bulk of extra taxes not kicking in until 2028.
She expected that further interest rate cuts from the Bank of England and a stabilising labour market would prompt “a more marked rebound as the year progresses”.