LONDON: Major UK mortgage lender Nationwide reported Wednesday that its monthly consumer confidence index fell in April to its lowest point since its launch in May 2004.

The index fell by seven points (22% year-on-year) to a reading of seventy. Nearly half of all respondents said they believed the economy will worsen further in six months time – twice the level of pessimism registered this time last year.

Moreover, consumers expect house prices to fall by a further 1.7%  between May and the end of October – pessimism that has led to concerns about employment prospects.

Comments Nationwide chief economist Finonnuala Earley: "The cut in interest rates in April did little to lift consumer spirits. Food and fuel prices remain high and, with house prices no longer rising, it is unlikely that consumer confidence will pick up very quickly.

"We may have to accept that confidence levels could well worsen before they get better. This is especially true as inflationary pressures mean the MPC [the Bank of England's Monetary Policy Committee] will probably prefer to cut rates at a more gradual pace than many would prefer."

Data sourced from The Times (UK); additional content by WARC staff