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Consumer Confidence · Deloitte Report · Retail Spending · UK Economy
UK consumer confidence declined to its lowest level in two years during Q4 2025, falling 1.1 percentage points from -10% in Q3 2025 to -11.1%, according to Deloitte's Consumer Tracker, driven by concerns over debt and disposable income.
Deloitte's report, based on responses from 3,200 UK residents aged 18 and over, indicates consumers employed defensive spending strategies, with 32% cutting down on luxuries, 39% being frugal, and 25% spending only on essentials. The primary drivers for this fall in confidence were a deterioration in perceptions of debt (-2.6 percentage points), household disposable income (-1.4 percentage points), and general health and wellbeing (-1.4 percentage points).
Sentiment around job security (-0.6 percentage points) and career progression (-0.9 percentage points) also contributed to the decline. Despite the overall negative trend, sentiment regarding the state of the UK economy improved by eight percentage points, reaching -56% in Q4 from -64% in Q3, though this was still 4.4 percentage points down on the year-ago reading.
Céline Fenech, consumer insight lead at Deloitte UK, states that consumers remain cautious about the economic outlook and will continue to hold off on spending until affordability and job prospects significantly improve. Ian Stewart, chief economist at Deloitte UK, anticipates easing inflation and further modest rate cuts will bolster consumer spirits in the coming months.
