Consumer confidence in the UK has declined in September as inflation continues to strain household budgets, new data from the British Retail Consortium (BRC) and opinion polling group Opinium shows.

The survey indicates growing pessimism about the economy and personal finances, amid fears that rising costs — especially food inflation — will persist and hamper retail and saving behaviour.

Sentiment across the economy and households

The BRC-Opinium Consumer Sentiment Monitor, which surveys 2,000 UK adults, found that expectations for the state of the economy over the next three months worsened to -36 in September, down from -32 in August.

Similarly, views on personal financial situations dipped to -7 from -6 month-on-month. While expectations for spending on retail showed a small increase.  (rising to +5 from +4), forecasts for personal spending overall dropped slightly from +16 to +14.

The outlook for saving also weakened: saving expectations fell to 0 in September from +2 in August.

Generational divides and inflation concerns

Helen Dickinson, Chief Executive of the BRC, pointed out a sharp decline in confidence among Millennials (aged roughly 28-43), who revised down their expectations for both economic and financial conditions by double digits.

In contrast, Generation Z remains comparatively more optimistic, helping to partially offset the overall dip in confidence.

Food inflation is emerging as a major worry. The survey cites a projected rise in food inflation to about 6% by the end of the year.

Also, recent Office for National Statistics data showed that the annual inflation rate for food and non-alcoholic beverages rose to 5.1% in August, up from 4.9% in July.

Implications for spending, retail, and government policy

The weakening in savings expectations points towards reduced buffer for many households if prices continue to climb.

Retail spending intentions remain slightly positive, suggesting consumers are still willing to make purchases, but overall discretionary spending may be under pressure.

Policy is now under scrutiny. Dickinson stressed that what the Chancellor announces in the Autumn Budget (scheduled for 26 November) could influence inflation, cost of living, and consumer confidence.

A specific policy recommendation coming from the BRC is reform of business rates. The body urges meaningful reductions in retail business rates, while ensuring no shops pay more under any new scheme.

Background: UK inflation and cost of living trends

Inflation in the UK remains elevated. Overall annual consumer price inflation stood at 3.8% in August, unchanged from July.

Food inflation in particular has been rising steadily, contributing significantly to pressure on households.

With inflation expected to stay high, many households are reporting anxiety over their finances and spending power. The coming months are likely to test how resilient consumer demand is under evolving economic pressures and policy responses.