British consumer mood sours further

British consumer confidence fell last month and people are more reluctant to make major purchases than at any time since records began in 1982, according to a survey.

Research company GfK NOP said its consumer confidence index slipped to -36 last month from -32 in September as worries over the economy and the global financial crisis soured the public mood. Analysts had expected a more modest easing to -35.

The climate for major purchases index slumped to -43, the lowest reading since records for that measure began in 1982.

Retailers are clearly suffering. John Lewis Partnership said sales at its 27 department stores fell 9.8 per cent on the year last week.

"Consumers are not at all confident about making major purchases as rising food and energy bills leave them increasingly worried about keeping up with payments, and saving has also seen a considerable drop, possibly due to fears of the safety of savings," said Rachael Joy of GfK NOP.

The "now is a good time to save" index fell nine points on the month to +9, the lowest since the start of 2004, perhaps as worries over the banking system and low interest rates encouraged people to think of hoarding cash.

Roughly half the responses in the GfK survey came before the Bank of England made an emergency cut in interest rates on October 8, and half afterwards.