BRC: Consumer confidence on ice until after the election

Date: 9th February 2010

Consumer confidence has "gone as far as it is going to go for now" and will remain "on ice" until after the general election later this year.

This is the view of the British Retail Consortium (BRC), which said consumers are not going get any more "enthusiastic" about the future of the economy until the results of the election are known.

Speaking at the Totally DIY show at the Birmingham NEC, Stephen Robertson, director general of the BRC, said mortgage customers would do well to brace themselves for sharp rises on the interest on their home loans as the Bank of England looks to increase its base rate from the current historic low of 0.5 per cent.

He said many homeowners, who have been paying almost zero per cent interest on tracker mortgage deals, are going to be "horrified" as the rate increases to anything up to seven per cent.

"That is going to be an effect on consumer confidence and will certainly affect household disposable income," he said.