UK consumers hit by worries over war in Iran, S&P Global says

UK consumers hit by worries over war in Iran

Impact of Middle East Conflict on UK Consumer Confidence

LONDON, March 16 (Reuters) - British consumers have turned their least confident since the start of last year following the outbreak of war in the Middle East, financial data firm S&P Global said on Monday in an early sign of the potential impact of the conflict on the economy.

Consumer Sentiment Index Trends

S&P Global's Consumer Sentiment Index - based on a survey conducted March 5-9 - dropped to 44.1 in March from 44.8 in February, its lowest since January 2025.

Expert Analysis

"A marked deterioration of consumer sentiment in March means we are seeing the first concrete signs of the war in the Middle East damaging the UK economy," Maryam Baluch, an economist at S&P Global Market Intelligence, said.

Household Financial Outlook

Households were the most downbeat about their financial prospects since December 2023 and the wariest about making big purchases in 14 months, the firm said.

Broader Economic Implications

The Bank of England, along with private economists, is watching for the impact of the U.S-Israeli war with Iran on the economy, including any hit to consumer spending as the rise in global energy prices threatens to push up inflation.

Interest Rate Decisions

The BoE is likely to delay a previously expected interest rate cut on Thursday.

Public Perception of the Conflict

A separate survey published by polling firm YouGov on Monday showed 77% of respondents expected the conflict would have a negative impact on the UK and global economies in the longer term, and 64% expected a hit to their household finances.

Expectations Regarding Iran's Nuclear Ambitions

Survey Results

Only one in four of those surveyed thought the attacks on Iran would succeed in stunting the country's apparent nuclear ambition, YouGov said.

(Writing by William Schomberg; editing by Andy Bruce)