Consumer confidence has experienced a dramatic collapse as the escalating war in the Middle East fuels widespread fears of soaring inflation in the coming months, according to the latest figures. The British Retail Consortium (BRC) survey conducted by Opinium, which polled 2,000 UK adults between March 10 and March 13, 2026, shows that consumer expectations for the economy over the next three months have plunged to their lowest level on record.
Record Lows in Economic and Personal Finance Expectations
The survey indicates that consumer expectations for the economy dropped sharply to minus 53 in March, down from minus 30 in February. This represents the most pessimistic outlook ever recorded since the survey began. Similarly, expectations for personal finances fell to a record low of minus 17, a significant decline from minus six in the previous month.
Spending Predictions Rise Amid Inflation Concerns
In contrast to the gloomy confidence figures, spending predictions increased by seven points to 13. This rise suggests that shoppers anticipate higher costs, particularly in energy, which they expect to ripple across the broader economy. The conflict in the Middle East has heightened concerns about global energy prices, contributing to this shift in consumer behavior.
Impact on Different Generations
The collapse in confidence was most pronounced among the Boomer generation, who are particularly reliant on investment and pension funds. As stock markets tumbled in response to the geopolitical tensions, this demographic felt the brunt of the economic uncertainty, leading to a sharper decline in their outlook compared to other age groups.
Government Policy Under Scrutiny
BRC chief executive Helen Dickinson emphasized the critical need for government intervention. She stated, "Consumer confidence collapsed as the Middle East conflict raised the prospect of higher inflation in the months ahead. The current conflict has created a great deal of uncertainty in the economy. Inflation is expected to rise in the coming months."
Dickinson added, "Just as the economy was beginning to turn a corner on inflation, the rise in global energy prices is particularly unwelcome for businesses and families. It is now vitally important that Government policy does not exacerbate the situation, and bringing down the cost of living must be a top priority."
She called on the government to focus on minimizing unnecessary costs for retailers, such as new employment laws and rising packaging taxes, to help protect ordinary households from the escalating cost of living. This approach, she argued, is essential to mitigate the adverse effects of the conflict on consumer confidence and economic stability.
Broader Economic Implications
The survey findings highlight the profound impact of geopolitical events on domestic economic sentiment. With consumer confidence at a record low, there are concerns about reduced spending and potential slowdowns in economic growth. The Middle East conflict has introduced a new layer of volatility, disrupting the fragile recovery from previous inflationary pressures.
As businesses and families brace for higher costs, the focus shifts to how policymakers and retailers can collaborate to stabilize the situation. The data underscores the interconnectedness of global events and local economies, with the war serving as a stark reminder of the vulnerabilities in consumer markets.
