As prices and rates rise, the ability of consumers to spend is falling

Responding to GfK’s Consumer Confidence Barometer for May, which has dropped to its lowest score since records began in 1974:

Linda Ellett, UK Head of Consumer Markets, Retail and Leisure, KPMG, said:

“As prices and rates rise, the ability of consumers to spend is falling.  Outgoings are being scrutinised, with some spend being curbed or canned.

“Consumers are increasingly searching out lower prices and offers.  But retailers, faced with their own rising inflationary pressures, will find it harder to provide them.

“The cost of living squeeze is of course feeling tighter for some consumers than others.  Amongst those we’ve surveyed: one third of consumers that started 2022 with savings are dipping into them to help meet their monthly essential costs.  But two-thirds of consumers with savings still plan to spend some on the things that they want in 2022.  It’s looking vital for the high street that in the coming months this group remain willing and able to spend.”

ENDS.

Media contact:

Steven Reilly-Hii, Media Relations Manager, KPMG LLP

E: steven.reilly-hii@kpmg.co.uk 

T: 07510 376635.

About KPMG:

KPMG LLP, a UK limited liability partnership, operates from 22 offices across the UK with approximately 15,300 partners and staff.  The UK firm recorded a revenue of £2.43 billion in the year ended 30 September 2021.

KPMG is a global organisation of independent professional services firms providing Audit, Legal, Tax and Advisory services. It operates in 145 countries and territories with more than 236,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.