EL7.AI
Macro EconomyMedium•26 October 2026•
2 min read

UK Consumer Confidence Posts Biggest Monthly Fall Since April 2020

Key Facts

1The Consumer Prices Index rose 3.5% in the 12 months to September, versus 3.1% in August.
2Retail sales volumes fell 0.4% in September, after rising 0.7% in August, and grew 0.7% in the third quarter compared with the second.
3The September consumer confidence reading was -13 points, the highest since August 2024.
4The GfK survey covered 2,003 adults between 1 and 14 October.

Consumer confidence in Britain fell in October, recording its biggest monthly drop since April 2020, Reuters reported, citing a GfK report. The September reading of -13 points was the highest since August 2024, Reuters said. The October survey covered 2,003 adults between 1 and 14 October. The decline comes ahead of Chancellor John Healey presenting the budget to Parliament on 28 October. In historical comparison, Reuters said the last similar fall outside the pandemic period followed Britain's vote to leave the European Union in June 2016.

Data from the Office for National Statistics showed the Consumer Prices Index rose 3.5% in the 12 months to September, compared with a 3.1% increase in August. Transport, particularly motor fuel, was the largest upward contributor to the annual rate. In spending data, retail sales volumes fell 0.4% in September, after rising 0.7% in August. But sales volumes grew 0.7% in the third quarter compared with the second quarter. Fuel sales and warm weather helped support growth in fuel, food and drink sales during the quarter, according to the Office for National Statistics.

The comparison between monthly and quarterly retail data points to a divergence between September's decline and the growth recorded in the third quarter. Volumes fell in September, while the July-to-September total remained higher than the April-to-June total. This coincided with annual inflation rising in September from the previous month. Reuters also reported that consumers' inflation expectations reached their highest level since April. In April, expectations had reached a peak close to their highest level in three and a half years, Reuters said.

Upcoming dates include the presentation of the UK budget to Parliament on 28 October, according to the Treasury. The following day, the Bank of England will publish its monthly Money and Credit release for September. The release typically includes data on consumer credit and mortgage approvals. On activity, the UK composite purchasing managers' index rose to 53.1 in October, its fastest pace since February, according to the related EL7 story. The data come alongside falling confidence and rising annual inflation, while retail figures showed quarterly growth despite September's decline.