Consumer confidence in Britain fell to its lowest level this year in October, according to the latest monthly survey from research company Martin Hamblin GfK. Consumer confidence dropped three points in October to +1, its lowest level since December 2001, having risen two points in September to +4. All five of the key measures in the survey fell this month, said GfK, with the biggest drop seen in the measure of the UK's economic performance over the past 12 months. It dropped four points to –23, the lowest reading in more than two years.
The drop in confidence may increase the chances of an interest rate cut by the Bank of England. It cut rates seven times last year to 4.0pc, but has held rates steady for the past 11 months. Earlier this month, three of the bank's policymakers voted to reduce borrowing costs by 0.25pc. Confidence in the US is also weakening as Americans become more pessimistic about the long awaited economic recovery. A measure of US consumer confidence by the New York-based Conference Board plunged to its lowest level in nine years this month. The board said yesterday that its consumer sentiment index fell to 79.4 in October from 93.7 in September. //www.fxcentre.com