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Consumers gloomiest since records began

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Date: Wednesday 07 May 2008

LONDON (ShareCast) - Consumers are less confident than at any time since the Nationwide began collecting data in May 2004, figures from the building society showed today.

Worries about the state of the economy caused the biggest ever monthly drop in the sentiment index, down to 70 in April from 77 the month before, 22% lower than a year ago.

"The cut in interest rates in April did little to lift consumer spirits,” said Nationwide's chief economist Fionnuala Earley.

"Food and fuel prices remain high and with house prices no longer rising it is unlikely that consumer confidence will pick up very quickly."

The survey revealed the biggest shift was in consumer sentiment around the current economic situation, with just 17% of the population thinking the present situation is good.

That’s less than half the corresponding figure of 36% recorded prior to the credit crunch and Northern Rock debacle last autumn.

Nationwide’s report showed all four measures of confidence dropped in April, with 60% of consumers thinking now is a bad time to make a major purchase such as a house or car.