The Middle East conflict has prompted a major shift in UK household spending intentions as a “ripple of fear” has taken hold, according to a respected measure of consumer confidence.
The monthly reading taken by data specialist GfK showed a leap in the number of those hoarding cash and avoiding big spending commitments as rising global energy prices put pressure on already squeezed budgets.
The survey noted a six percentage point decline in confidence about the economy over the next 12 months amid warnings the war will deliver price hikes across a growing number of goods and services in the coming months.
Money latest: Businesses hit by war-linked energy spike
Food is tipped to soon strongly reflect the hike in essential bills, following on from the fuel price shock witnessed within days of US-Israeli strikes on Iran.
There have also been forecasts the energy price cap will follow fixed rate deals up from July when it is first able to reflect the horrific oil and natural gas prices prompted by the war.
The latest market data on Friday showed that Brent crude oil remained above the $100 a barrel level at $1007 – up by almost 40% in the month to date. UK gas costs are more than 75% higher.
The country has had a cost of living problem since 2022 when Russia’s invasion of Ukraine sparked a more intense energy-led inflation crisis.
The government has made tackling the resulting decline in living standards its top priority.
But the scale of the challenge was laid bare on Thursday when a new government measure found that 13.4 million people, including just over…
