Household angst

The investment bank Jefferies has interviewed 5,500 people from 11 countries to build a picture of how citizens are coping with the lockdown, said Philip Aldrick in The Times. The results paint a mixed picture. Twothirds of Britons are “worried about both their financial situation and job security”, and a central preoccupation is “running out of food or household products”. However, most remain “remarkably optimistic”, believing that the hiatus also “has the potential to shake things up for the better”.

According to IHS Markit’s UK household finance index, confidence has “deteriorated” at its sharpest ever pace, said Gurpreet Narwan in the same paper. Indeed, IHS Markit’s “sub-index for job security perceptions” is at an alltime low. For now, many are “dipping into savings” to support their incomes and debt levels are broadly stable. But that may not last. With second-quarter GDP predicted to drop by 35%, the hoped-for “V-shaped recovery” postlockdown isn’t guaranteed, said deputy Bank of England governor Ben Broadbent – particularly if consumers remain cautious. China continues to be held back by weak consumer demand, he said, even though lockdown measures are being eased. Critically, “consumption accounts for 75% of UK GDP, compared with 55% in China”. As Louis Kuijs of Oxford Economics points out: “it’s easier to reopen a factory than to restart consumer spending”.