Brexit triggers biggest drop in consumer confidence in five years

Britain's decision to vote in favour of leaving the European Union last month prompted the biggest decline in consumer confidence in five years, a survey released on Friday (8 July) showed.

According to market research firm GfK, which carried out a special post-referendum survey, consumer confidence plunged from -1 to -9 in the aftermath of the vote, in what was the steepest decline since January 2011.

GfK added the index was now at its lowest level since December 2013, indicating it had not suffered a steeper decline since December 1994.

Perhaps unsurprisingly, GfK found the 48% of Britons who voted in favour of remaining in the EU were a lot more pessimistic about the future than the 52% who backed the Brexit campaign.

"Our analysis suggests that in the immediate aftermath of the referendum, sectors like travel, fashion and lifestyle, home, living, DIY and grocery are particularly vulnerable to consumers cutting back their discretionary spending," said Joe Staton, head of market dynamics at GfK.

Britain has been plunged in political and financial turmoil following the vote on 23 June, with the pound hitting two 31-year lows against the dollar in as many days earlier this week as the Bank of England warned the economy will face a slowdown.

That sentiment was reflected by accounting firm BDO, which reported retail sales tumbled in the lead-up to the vote. BDO's High Street Sales Tracker showed retail sales fell 3.6% year-on-year last month, marking the worst June on record in over 10 years.