Consumer confidence in the United Kingdom recorded its steepest quarterly decline since late 2022, as rising inflation and growing concerns over job security weigh heavily on households, according to Deloitte’s latest Consumer Tracker.

The survey revealed that the consumer confidence index fell by 2.6 percentage points to 10.4% in the second quarter of 2025 — the lowest level since Q1 2024.

This marks the most significant drop in nearly three years, discounting a marginal dip in 2024.

The last comparable fall occurred during Q3 2022, when inflation soared past 10% and markets were rocked by the fallout from then-Prime Minister Liz Truss’s mini-budget.

Deloitte attributed the latest slump to fears over income stability, debt levels, and the slowing labour market.

“Concerns of a slowing labour market have left consumers worried… while persistent inflation and a high cost of living have negatively impacted sentiment towards personal debt,” said Celine Fenech, Deloitte’s consumer insight lead.

The findings come on the heels of fresh economic data showing the UK unemployment rate rose to 4.7% in the three months to May — the highest since 2021 — while annual inflation spiked to 3.6% in June, its highest in six months.

Employers have voiced concerns over mounting employment costs, citing the national minimum wage hike introduced in April, rising payroll taxes, and impending legislative changes that would make it more difficult to terminate employees.

Deloitte’s data contrasts with a more upbeat reading from GfK’s long-running consumer confidence index, which recently posted its highest level since December — underscoring a split in consumer sentiment indicators as the UK grapples with economic uncertainty.