Consumers and the Economic Outlook: Quarterly Update - UK - October 2014

KEY FINDINGS
The revival in consumer confidence is slowing
Higher earners are seeing more of the benefits from the economic recovery
Key economic indicators
Figure 1: Key economic indicators, October 2014
CURRENT FINANCIAL SITUATION
2014: The revival in financial well-being has lost momentum
Figure 2: “How would you generally describe your financial situation at the moment?”, September 2014
The income squeeze is still having an impact
Figure 3: Financial health index, 2009-14
A stark divide between higher earners and the population as a whole
Figure 4: “How would you generally describe your financial situation at the moment?”, by household income, September 2014
CHANGES IN FINANCIAL WELLBEING
A year of financial consolidation
Figure 5: “How would you describe your finances compared to a year ago?”, September 2014
Three phases of the recovery
Figure 6: The recovery index, 2009-14
More evidence for the existence of a two-track recovery
Figure 7: “How have your finances changed over the last 12 months?”, by household income, September 2014
FINANCIAL CONFIDENCE
A dip in optimism
Figure 8: “And how do you feel about your financial situation over the next year or so?”, September 2014
Figure 9: Financial confidence index, 2009-14
Higher earners aren’t immune from financial worries
Mainstream brands threatened at both ends of the market
Figure 10: “And how do you feel about your financial situation over the next year or so?”, by household income, September 2014
SPENDING PLANS
Little change in spending plans
Figure 11: “Thinking about how you spend your money, which of the following have you done over the last three months? And which do you plan to do over the next three months?”, September 2014
Figure 12: Spending index, 2012-14
Higher earners are making the most of their good fortune
Figure 13: Spending index, by household income, September 2014
WHAT IT MEANS
A disconnect between economic data and consumer confidence…
…presenting continuing challenges to the mid-market