Nationwide reports a halt to the slide in consumer confidence

The feel-bad factor stopped getting worse as the nation’s gloom was steadied, possibly, by the dip in petrol prices, several cuts in mortgage rates and even Great Britain’s astonishing haul of Olympic gold.

Nationwide’s Consumer Confidence index held steady in August. The index number remained at a deeply depressed 52, but this was the month it has not fallen this year.

The only improvement was a fall, from 60 per cent to 57 per cent, in the number of people interviewed who fear that Britain’s economic situation will be worse in six months’ time – and a corresponding increase to 28 per cent in those who think it will be the same.

Only 11 per cent are still looking for an improvement and the number describing the present situation as “bad” actually rose four points to 65 per cent.

“Economic uncertainty continues to affect sentiment around spending and employment, but it seems that consumers are beginning to take a realistic view of the future and are factoring in the possibility of tougher times ahead, said Fionnuala Earley, Nationwide’s chief economist.

“Lower petrol prices and more competitive new mortgage rates will be good news for the public. Team GB’s Olympic performance in Beijing may even have helped lift the nation’s spirits slightly.”

Views on jobs continued to worsen. The number saying there are either many or some jobs available, which had picked up in the early summer, slipped another two points to 39 per cent last month.

Looking ahead, only 28 per cent think that will still be the case in six months’ time, unchanged from July – and 47 per cent fear there will be “not many” or “few” jobs next February, up sharply from 42 per cent in July.

A surprising mid-summer rally in the minority saying this is a good time to make a major purchase, petered out last month, returning to 14 per cent, while an overwhelming 68 per cent said it was a bad time to buy a house or a car.

The number saying it is a bad time to buy household goods is also creeping up steadily, to 23 per cent from 11 per cent in March. But there was also a three-point increase to 28 per cent in those saying it is a good time to buy furniture, say, or fridges.