A vibrant economy depends in large part on consumers' confidence in their financial future.
And, in Britain, consumer confidence has been dwindling.
Here's an excerpt from a Nov. 19 Marketwatch article:
Consumer confidence in the U.K. decreased for the second consecutive month in November, driven by a sharp deterioration of Britons' outlook for their personal finances amid a second lockdown to contain the spread of Covid-19.
A measure of consumer confidence compiled by German market research firm GfK fell to minus 33 in November, compared with the minus 31 registered the prior month...
The reading is in line with expectations from economists polled by The Wall Street Journal.
Consumer sentiment in the U.K. has fallen significantly in the last two months amid the spike in Covid-19 cases across the country, almost erasing gains in confidence registered over the summer months.
In November, the decline in confidence was driven by a worsening outlook of consumers' personal finances for the last twelve months and for the year to come, which fell by seven and five points, respectively.
"People are clearly losing their nerve regarding their personal finances [...] This will deal a blow to any future rebound because bullish consumer spending fuels the U.K. economy and low confidence is the enemy of recovery," [said the] client strategy director at GfK.
The "sharp deterioration of Britons' outlook for their personal finances" is not surprising, given job losses.
As Elliott Wave International's October Global Market Perspective noted:
It was just three months ago that Britain allowed nonessential shops to reopen at all. Britain's hospitality sector reopened in July, and, despite the economy's gradual return to life, monthly unemployment just saw its largest increase since the pandemic began... Today, fully eight months into the pandemic, weekly footfall across UK department stores and town centers is still off 30%-40% [as the chart below shows]: