UK consumer confidence dropped to the lowest in more than 15 years in April after falling house prices and higher energy costs dented households' spending power, according to GfK NOP Ltd.
A gauge of sentiment declined 5 points from March to minus 24, the lowest since November 1992, the London-based market researcher said today, citing its poll of 2,007 people for the European Commission. All five components of the index declined.
The Bank of England has cut its benchmark interest rate three times since December and stepped up its efforts to help banks hurt by the credit squeeze as it tries to prevent the economy from tipping into a recession.
Mortgage approvals dropped to the lowest since at least 1999 in March, and the economy expanded at the slowest pace since 2005 in the first quarter.
"With the news dominated by stories of recession, the credit crunch, housing market falls, and future petrol and food price increases, it will take more than a quarter point reduction in interest rates to alleviate the current gloomy mood,'' Rachael Joy, who works on the survey for GfK, said in a statement.
Oil prices climbed to a record $119.93 per barrel on April 28th, pushing up the cost of gasoline and other fuels for consumers. U.K. house prices fell 2.5 percent in March from a month earlier, the most since 1992, HBOS Plc said this month.
Yesterday the IIB/ESRI index of Irish consumer sentiment showed the lowest reading since the survey began 12 years ago on concerns over job loses and rising prices.
Bloomberg