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UK Consumer Morale Tumbles In April, Nationwide Says

UK Consumer Morale Tumbles In April, Nationwide Says
5/11/2012 12:01 AM ET

British consumer sentiment worsened in April after improving to a nine-month high in March, as households turned increasingly pessimistic about their current and future economic conditions.

The Nationwide Building Society said Friday that its consumer confidence index fell to 44 from March's 53. The index reading was well below its long-run average.

"The index has consistently remained well below its long-run average, signalling ongoing caution on the part of U.K. consumers," Nationwide' s chief economist Robert Gardner said.

All the components of the index deteriorated during the month. Consumers have become more downbeat about their current situation, economic expectations and spending.

The UK returned to recession with the economy contracting 0.2 percent in the first quarter after 0.3 percent slump in activity in the fourth quarter of 2011. The Bank of England on Thursday refrained from providing further cash boost to the recession-struck economy as the decision was apparently weighed down by sticky inflation.

Hovering stubbornly above the 2 percent target, inflation rose to 3.5 percent in March driven by higher food and clothing prices.

Inflation, austerity and unemployment are hampering consumers' ability to purchase big ticket items. These factors along with the wettest weather on record considerably affected retail sales in April, a survey by the British Retail Consortium (BRC) showed Wednesday.

by RTT Staff Writer

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