Back to Headlines
Economy
May 18, 2026
Analyzed by GPT OSS 120B

Rising Prices Top Britons' Money Worry as Inflation Stays High, Survey Finds

AI Summary
A monthly S&P Global consumer confidence survey shows rising prices have become the top financial worry for UK households, with the sentiment index slipping to 42.1 in May. The report flags accelerating savings declines, heightened interest‑rate expectations and mounting pressure on the Bank of England to act.

Survey Shows Rising Prices Overtake All Financial Concerns

Rising prices have become the leading money worry for British households, according to the latest S&P Global consumer confidence survey released ahead of official inflation data.

Consumer Sentiment Index Drops to 42.1 in May

The Consumer Sentiment Index fell to 42.1 in May from 42.3 in April, marking the lowest reading since July 2023 when inflation surged after the Russian invasion of Ukraine. The index aggregates views on household spending, financial wellbeing, savings, debt and employment.

  • Survey of 1,500 adults across the UK.
  • Score of 42.1 – lowest since July 2023.
  • Confidence decline coincides with higher fuel prices linked to Middle‑East tensions.

Numbers Reveal Deepening Savings Erosion and Interest‑Rate Anxiety

Britons reported a "substantial decline" in household savings in May, the fastest pace since July 2023, driven by soaring energy costs.

  • Savings falling at a rate not seen since 2011 (excluding the pandemic).
  • 51% of respondents expect interest rates to rise – the highest proportion in two‑and‑a‑half years.
  • Bank of England warned energy bills could rise 16% to £1,900 by summer and food prices 7% by year‑end.

Implications for UK Household Spending and Economic Growth

The combination of squeezed finances, job insecurity (highest since March 2023) and pessimism about big purchases is likely to curb consumer spending, which could dampen overall economic growth.

  • Job insecurity at its highest level since March 2023.
  • Attitudes toward major purchases among the most downbeat in almost three years.

Outlook: Inflation Persistence and Potential Policy Responses

Official CPI data showed inflation at 3.3% in March, up from 3% in February, with April figures expected to edge down to around 3% – still above the Bank of England’s 2% target. If global oil prices remain elevated, the Bank may be forced to raise rates later in 2026, further tightening household budgets.

Economist Maryam Baluch of S&P Global Market Intelligence cautioned that the current environment “is deterring spending to a degree rarely witnessed by the survey, which in turn looks set to dampen economic growth.”