Economic downturn 'took people by surprise'

By Sarah Engle, Thu 7 Aug 2008 - Published in Banking

The credit crunch has seen day-to-day expenses rise and has made it more difficult to borrow money through loans and credit cards.

According to Moneyfacts, if the economic downturn had happened gradually people would have had time to adapt.

However, head of public relations Darren Cook said: "We've gone from the crest of the wave to the wave hitting the shore in such a short time that people's perceptions and confidence has dropped."

He stated if the change in economic conditions had happened over a period of 12 to 24 months – instead of three to four months – people would have coped better.

This comes after the Nationwide Consumer Confidence Index revealed a drop of 11 points to 51 in July, 18 per cent lower than this time in June and 46 per cent lower than a year ago.

The survey also showed 85 per cent of those questioned believe the situation will be the same or worse in six months time.

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