Families' cash fears worst for 26 years

The monthly poll of consumer sentiment found that householders' confidence about economic conditions over the next 12 months had sunk to its lowest since 1982.

It is one of five measures which make up the GfK NOP barometer of confidence.

Worried: Families have lowest confidence in economic future since 1982

All five graphically demonstrated families' fears amid spiralling household bills.

The major purchases index  -  which measures the appetite for buying big items like fridges and washing machines  -  also fell to an all-time low.

The index measuring people's expectations for their own personal financial situation over the next year fell to a level not seen since September 1995.

Overall, the market research company's survey showed consumer confidence is at its lowest since since 18 years ago, when Britain was facing recession, and not far above the lowest since the index was launched in 1974. It was the tenth month in a row that overall confidence has fallen.

The GfK NOP poll  -  based on 2,001 representative people's views on their own finances as well as wider economic conditions  -  uses a mathematical formula to convert the findings into a single score.

Rachael Joy, of GfK's consumer confidence team, said: 'With rising inflation, gloomy forecasts for interest rates and soaring fuel, utility and food prices dominating the front page headlines, it's no surprise that confidence in the general economy is almost in freefall. It seems unlikely that this trend will reverse in the near future.'

To add to their worries, families face a potential rise in interest rates as the Bank of England struggles to get a lid on inflation.