Falling to just 81 points, the consumer confidence index has hit its lowest level since the survey began.
On top of this, consumer sentiment about the economic and employment situation, including their own income, fell four points in January from 83 to 79. This is believed to be driven by a lack of confidence in the number of future jobs available.
Driven by the current economic state, Nationwide's Present Situation Index fell five points to 83. However despite this, the Spending Index remained stable in January.
Martin Gahbauer, Nationwide’s senior economist, said the decline in confidence was to be expected in light of ongoing 'uncertainties.'
"Sharp falls in share prices, the rising cost of essential items and a weak exchange rate have combined to negatively impact consumer sentiment, which could be a reason for the increased pessimism around the future economic and employment situation.
"The expected rate cut in February may boost sentiment in the short-term but it will be some time before consumer confidence is back to the levels reported a year ago.”
Furthermore, consumers expect house prices to decrease by -0.2 per cent over the next six months, down from a projected increase of 0.7 per cent in December.
