Consumer confidence hits new low

UK consumer confidence fell for a third month in a row in October amid concerns about the state of the economy and job prospects, according to a survey by the Nationwide Building Society.

The building society's consumer confidence index fell to 92, its lowest level since the survey began last year.

The decline echoed a similar survey from GfK NOP which showed sentiment fell to its weakest level in October since start of the Iraq war in 2003.

A total of 1,000 people were polled for the Nationwide survey.

The Nationwide blamed a string of bad news for continuing weakness in the consumer confidence index, which has dropped 16% since peaking in April.

"Job losses at Rover, the London attacks in July, low house price growth and most recently higher petrol prices have all contributed to a summer of gloom which is threatening to extend through the autumn," said Nationwide executive director Stuart Bernau.

Looking ahead, prospects for the housing market improved with 41% of people expecting price rises in the next six months - the highest level since August 2004.

The Nationwide also found that retail sales could be about to turn the corner with more shoppers expecting to make major purchases in coming months.

"Recent positive news about both the number of housing transactions and house price inflation, as well as retail sales, all give indications that better times may lie ahead," Mr Bernau added.