The latest Ipsos Political Monitor, taken 22 to 29 June shows significant public concern at the potential for inflation to rise further amidst gloomy economic expectations.
Inflation and cost of living
- When asked about their current financial situation, half of Britons (50%) tell us they ‘have had to make some reductions in what I normally buy because of rising prices but I can cope’. However, 1 in 5 (20%) say they are ‘finding it very difficult to cope with the rise in prices’. One in four (27%) say they have not had to make any changes in what they buy due to rising prices.
- However, should inflation rise to around 11% later this year, one in three (32%) say they would find it very difficult to cope and 52% say they ‘would have to make some reductions in what I normally buy because of rising prices but I could cope’. Just 15% say they would not have to make any changes.
- When asked what they would be most likely to cut back on in the event inflation hits 11%, treats and luxuries top the list (63%), followed by other premium / expensive brands (56%), how much they use heating, electricity or water (52%), holiday plans (50%), and whether or not they but new large household appliances such as TVs or furniture (49%).
- Some 77% expect the economy to worsen in the next 12 months (+5 points from May). Just 13% expect it to improve (-2 points). This gives a net Ipsos Economic Optimism Index score of -64, similar to the score of -62 in March and otherwise in our records going back to 1978 has only ever been this low in July 2008 (around the time of the financial crash) and January 1980.
Most trusted party on key issues
- When asked which party is most trusted on various issues, the Conservatives lead Labour by 32% to 26% on growing the economy. This 6 point lead on growing the economy has weakened from leads of 13 points and 9 points in March and May respectively and matches the lead the Conservatives held in January.
- On reducing yours and your family’s cost of living, Labour lead by 33% to 21%. This 12-point lead is slightly down on a 15 point lead Labour held in May. Back in January, Labour led by 17 points.
- On managing inflation, 30% say they would trust the Conservatives most, and 27% Labour.
- Finally, Labour leads by 16 points on levelling up (34% to 18%) but had led by 30 points in January (44% to 14%) and 21 points in May (39% to 18%).
Gideon Skinner, Head of Political Research at Ipsos UK said, “Britons tell us that the cost of living is the most important issue facing the country, with concern at the highest levels Ipsos has seen in our trends for 40 years, and with many worried about how they will cope if inflation rises as forecast to 11%, we can expect public anxiety to continue.
“Given this it is also a key political battleground, with the Conservatives most trusted on growing the economy, Labour to reduce the cost of living, and who is best to manage inflation still an open question. The party who can best set the agenda on this issue could make real headway.”