Finance
UK consumers hit by worries over war in iran, S&P global says
Published by Global Banking & Finance Review®
Posted on March 16, 2026
2 min readLast updated: March 16, 2026
Quick Summary
British household confidence fell to its lowest level since January 2025 amid rising fears over the war in Iran, as energy price pressures and debt worries weigh on spending intentions.
UK consumers hit by worries over war in Iran
Impact of Middle East Conflict on UK Consumer Confidence
LONDON, March 16 (Reuters) - British consumers have turned their least confident since the start of last year following the outbreak of war in the Middle East, financial data firm S&P Global said on Monday in an early sign of the potential impact of the conflict on the economy.
Consumer Sentiment Index Trends
S&P Global's Consumer Sentiment Index - based on a survey conducted March 5-9 - dropped to 44.1 in March from 44.8 in February, its lowest since January 2025.
Expert Analysis
"A marked deterioration of consumer sentiment in March means we are seeing the first concrete signs of the war in the Middle East damaging the UK economy," Maryam Baluch, an economist at S&P Global Market Intelligence, said.
Household Financial Outlook
Households were the most downbeat about their financial prospects since December 2023 and the wariest about making big purchases in 14 months, the firm said.
Broader Economic Implications
The Bank of England, along with private economists, is watching for the impact of the U.S-Israeli war with Iran on the economy, including any hit to consumer spending as the rise in global energy prices threatens to push up inflation.
Interest Rate Decisions
The BoE is likely to delay a previously expected interest rate cut on Thursday.
Public Perception of the Conflict
A separate survey published by polling firm YouGov on Monday showed 77% of respondents expected the conflict would have a negative impact on the UK and global economies in the longer term, and 64% expected a hit to their household finances.
Expectations Regarding Iran's Nuclear Ambitions
Survey Results
Only one in four of those surveyed thought the attacks on Iran would succeed in stunting the country's apparent nuclear ambition, YouGov said.
(Writing by William Schomberg; editing by Andy Bruce)
Key Takeaways
- •The S&P Global UK Consumer Sentiment Index declined to 44.1 in March from 44.8 in February, marking its weakest reading since January 2025 (moneyweek.com).
- •UK households are most pessimistic about their financial prospects since December 2023 and least willing to make big purchases in over a year (moneyweek.com).
- •Surging energy costs—especially for heating oil with rises over 120%—and concerns about inflation and mortgage rates are curbing consumer confidence and spending (moneyweek.com)
References
Frequently Asked Questions about UK consumers hit by worries over war in Iran, S&P Global says
1What has caused UK consumer confidence to drop?
UK consumer confidence dropped due to concerns over the outbreak of war in the Middle East, specifically the conflict involving Iran.
2What is the latest UK consumer sentiment index figure?
According to S&P Global, the index fell to 44.1 in March from 44.8 in February, marking the lowest since January 2025.
3How are UK households responding to the situation?
Households are increasingly pessimistic about their financial prospects and are hesitant to make major purchases.
4What is the Bank of England's response to the current economic situation?
The Bank of England is expected to delay an anticipated interest rate cut as it monitors the impact of rising energy prices and the Middle East conflict.