The Deloitte Consumer Tracker Q4 2025

Key findings Q4 2025

1. Overall confidence fell to its lowest level in two years in Q4 2025. The Deloitte Consumer Confidence Index dropped one percentage point from -10% in Q3 2025 to -11.1% in Q4 putting the index below its long-term average for the first time in two years.
2. The fall in the overall confidence was driven by a drop across five of the six measures included in the index. Deterioration in perceptions of levels of debt, household disposable income, general health and wellbeing drove the decline in overall consumer confidence which was also impacted by negative sentiment around job security, and job opportunities and career progression.
3. Sentiment about the state of the economy improved returning to levels last seen at the start of 2025. The measure of confidence in the UK economy, which is separate from the main index, grew by eight percentage points to -56% in Q4 2025 from -64% in Q3, representing the biggest increase since Q2 2024 and returning to levels last seen in Q1 2025 before the budget rumours began to emerge.
4. Both discretionary and essential spending measures are down for a second consecutive quarter. Despite Q4 including the crucial Christmas shopping season, a combination of consumers spending less due to falling inflation but also consumers buying less meant net spending was down across almost all categories. The only exceptions were for spending on utility bills and alcohol which grew in Q4 mainly due to seasonality, while spending on electrical equipment remained flat.
5. Consumers blame higher prices and responded by cutting down on non-essentials. When asked about their financial situation and attitude to spending compared with the previous three months, 41% of consumers agreed they spent more because of rising prices, while a similar proportion said they were more frugal and one in three cut down on any luxuries or treats.
6. Our data indicates an increased share of consumers prioritising value and adopting more cautious spending behaviours. Among consumers spending less, the share saying they took advantage of sales and discounts rose by 10.5 percentage points. The number of consumers who planned what and how much to buy rose by 5.9 percentage points, and those choosing cheaper items, brands, stores or activities rose by 3.5 percentage points.

Despite more than two years of real wage growth strengthening household finances, UK consumers are remaining cautious and overall confidence is still below its pre‑pandemic levels. The Deloitte Consumer Confidence Index fell by one percentage point in Q4 2025 to -11.1%, its lowest level in two years, driven by declines across five of the six measures included in the index. Sentiment weakened following worsening perceptions of household debt, disposable income, health and job prospects.

At the same time, sentiment about the UK economy improved compared with Q3 as pre‑budget uncertainty receded, inflation eased and the Bank of England continued to reduce interest rates, easing pressure on consumer budgets. However, our consumer spending data has continued to trend down since the start of 2025, with consumers citing higher prices and the need to be more frugal as key influences on their behaviour in Q4, with many reducing discretionary purchases and shifting towards discounted and essential items.

As a result, net spending fell across most categories in Q4 2025, except for utility bills and alcohol, while spending on electricals remained flat. Grocery spending unexpectedly weakened despite easing food inflation. Consumers reported more deliberate budgeting and value‑seeking, including increased use of discounts, greater planning of purchases as well as choosing cheaper items, brands and stores.

While there were hopes that falling inflation and lower borrowing costs would boost consumer spending, the overall picture remained one of caution: consumers are making tactical choices in the face of weakening employment and slowing wage growth, suggesting that a sustained recovery in consumer confidence might take yet more time.