Beleaguered Rachel Reeves has acquired a contemporary setback as figures present a pointy hunch in client confidence in an indication that ‘individuals see darkish days forward’.
It added to the gathering gloom over the financial system at the beginning of the yr as grocery store chain Sainsbury’s yesterday revealed a cull of three,000 jobs whereas cut-price retailer Primark stated its gross sales have been struggling.
With progress stagnant and inflation turning larger, the Chancellor has jetted to the World Financial Discussion board in Davos to attempt to drum up funding from world bosses.
In the course of the conferences she has repeatedly insisted on her dedication to progress and that she is taking up regulators getting in the way in which of enterprise.
However critics say it’s her personal insurance policies, particularly the £25billion raid on employer nationwide insurance coverage that surprised enterprise, which can be doing the most important injury – and that there has up to now been little signal of the promised drive to spice up the financial system.
At present, a closely-watched new survey by information agency GfK reveals that the gloom is now feeding via to abnormal households. It confirmed that client confidence has this month dropped to its lowest stage since December 2023.
Neil Bellamy, GfK’s client insights director, stated: ‘New 12 months is historically a time for change, however taking a look at these figures, customers don’t suppose issues are altering for the higher.’
The ballot revealed notable falls in households’ views on the broader financial system.
Rachel Reeves (pictured in Davos) has acquired a contemporary setback as figures present a pointy hunch in client confidence in an indication that ‘individuals see darkish days forward’

Grocery store chain Sainsbury’s yesterday revealed a cull of three,000 jobs

Primark’s father or mother firm Related British Meals revealed a gross sales setback attributable to the darkening temper amongst customers for the reason that Finances
‘These figures underline that customers are dropping confidence within the UK’s financial prospects,’ stated Mr Bellamy.
There was additionally a giant bounce in a measure of financial savings intentions.
‘This sharp improve is unwelcome as a result of it’s one other signal that individuals see darkish days forward and are subsequently pondering of placing cash apart for security,’ Mr Bellamy added.
In one other blow, a separate report from the Confederation of British Trade (CBI) discovered British factories continued to wrestle at the beginning of 2025 as optimism amongst producers sagged to its lowest stage in over two years.
‘Producers have entered the brand new yr in a grim temper. Confidence has evaporated during the last three months as orders have dropped,’ stated Ben Jones, lead economist on the CBI.
Ms Reeves insisted throughout a Wall Road Journal occasion in Davos that the federal government was ‘proudly pro-business’ and was compelled as soon as once more to defend the Finances, claiming there was ‘no critical various’ to her actions.
‘I’m not going to apologise for placing our public funds on a agency footing,’ she stated. ‘It was the Finances that was needed.’
The Chancellor stated the federal government was now embarking on reforms ‘eradicating these limitations which have stopped companies investing in Britain for too lengthy’.

Ms Reeves is presently with fellow politicians and enterprise leaders on the World Financial Discussion board in Davos

Ms Reeves insisted throughout a Wall Road Journal occasion in Davos that the federal government was ‘proudly pro-business’ and was compelled as soon as once more to defend the Finances, claiming there was ‘no critical various’ to her actions

Charlie Nunn, CEO of Lloyds Banking Group, stated quite a lot of enterprise leaders ‘have been involved about what’s occurring in the intervening time’
Yesterday, the boss of Lloyds Banking Group – Charlie Nunn – stated: ‘The Chancellor has talked about having set the foundations and having obtained the foundations proper. That was actually essential.
‘We didn’t have financial plans for the UK that was steady and in a great place. However what we are going to see over the following few months is the issues they’ve talked about must now be accelerated and they should come at tempo.’
Mr Nunn, who can be in Davos, informed Bloomberg TV that quite a lot of enterprise leaders ‘have been involved about what’s occurring in the intervening time’.
The temper on the excessive road has been significantly grim as Ms Reeves’s NI hike falls significantly laborious on main retailers.
Sainsbury’s stated the ‘significantly difficult price setting’ was behind its determination to chop 1000’s of jobs because it shuts down its remaining cafes and closes patisserie and pizza counters.
And Primark’s father or mother firm Related British Meals revealed a gross sales setback attributable to the darkening temper amongst customers for the reason that Finances.
Finance director Eoin Tonge stated: ‘There’s little question we’re affected by a weak client, significantly parts of our client base who’re clearly struggling.’