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					                                                       Nationwide Consumer                                                                                                                                                                                                           Issue - July 2008


                                                       Confidence Index
           Headline
           Headline                                                                                                                   Expectations                                                              Spending                  Household                          Present                       Historic Scores
            News
            News                                                                                                                         Index                                                                   Index                   and property                    Situation Index                  and Background



Consumer Confidence
Consumer confidence falls four points
Consumer confidence fell 4 points                                                                                                                                3%, showing a 10% swing overall.                                  For the first time this month all of
this month, taking it to yet another                                                                                                                             It is also worth noting that whilst                               our Indices have been produced
new low*. The biggest shift was                                                                                                                                  this was the main driver, all of the                              using seasonal adjustments
in consumer sentiment around                                                                                                                                     other contributing factors also                                   on our Nationwide Consumer
the future economic situation.                                                                                                                                   showed negative movements this                                    Confidence methodology. Indices
The key change here was a 7%                                                                                                                                     month, indicating that consumers                                  are seasonally adjusted using
increase in the number saying                                                                                                                                    are still lacking confidence in all                               the US Bureau of the Census
it will be worse or much worse.                                                                                                                                  areas of their finances.                                          X12 method. Currently the
Furthermore, the number of                                                                                                                                                                                                         calculations are based on a
positive respondents also fell by                                                                                                                                                                                                  monthly data series starting
                                                                                                                                                                                                                                   from May 2004. Figures are
                                                                                                                                                                                                                                   recalculated each month which
                                                                                                                                                                                                                                                                                       Contact
                                                                                                                                                                                                                                   may result in revisions to
                Chart 1 - Nationwide Consumer Confidence Index                                                                                                                                  UK Economic Situation - 6 months
                                                                                                                                                                                                                                   historical data, but this allows us
                                                                                                                                                                                                                                                                                       Sharon Rees
 120
                                                                                                                                                                                   60                                              to remove seasonal variations,                      TNS, 222 Gray’s Inn Road
 110                                                                                                                                                                               40
                                                                                                                                                                                                                                   such as August and December                         London WC1X 8HB
                                                                                                                                                                  % of consumers




 100
                                                                                                                                                                                                                                                                                       United Kingdom
                                                                                                                                                                                                                                   gloom in spending, from the
                                                                                                                                                                                   20
 90
                                                                                                                                                                                    0

                                                                                                                                                                                                                                   trends.
 80
 70                                                                                                                                                                                -20                                                                                                 Tel: +44 (0) 20 7160 5656
 60                                                                                                                                                                                -40                                                                                                 Fax: +44 (0) 20 7160 5950
 50
                                                                                                                                                                                   -60
                                                                                                                                                                                         Good        Bad      Net
                                                                                                                                                                                                                                                                                       Email: consumer.confidence@tns-global.com
                         Nov-04




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                                                                                                          Source:TNSresearchf or Nat ionwide




                                                                                                                                                                                                                                   * Note the Nationwide Consumer Confidence Index
                                                                                                                                                                                                                                     was first published in May 2004.
                                                     Nationwide Consumer                                                                                                                                                                                           Issue - July 2008


                                                     Confidence Index
               Headline                                                                                                          Expectations                                                               Spending              Household                  Present                     Historic Scores
                News                                                                                                                Index                                                                    Index               and property            Situation Index                and Background



The Expectations Index
Consumers pessimistic about future economy
The Expectations Index fell 6                                                                                                                                   As on the NCCI, the main driver                              Whilst the number who think they
points this month. This is the                                                                                                                                  behind the fall has been the 10%                             will earn less in 6 months time
third time this year that the Index                                                                                                                             negative swing in consumer                                   has fallen for the first time this
has registered a 6 point fall and                                                                                                                               sentiment around the future                                  year (from 15% to 14%), a 7%
means it now stands at 64. This                                                                                                                                 economic situation. However                                  jump in the normally very stable
is the 6th consecutive month that                                                                                                                               another mitigating factor behind                             number who think they will earn
it has fallen.                                                                                                                                                  the fall is the noted lack in                                no more or no less in the future,
                                                                                                                                                                confidence surrounding projected                             and a 5% decrease in those
                                                                                                                                                                household incomes in 6 months                                thinking they will still earn more,
                                                                                                                                                                time.                                                        have brought the scores further
                                                                                                                                                                                                                             down. The proportion thinking
                                                                                                                                                                                                                             they will earn more in 6 months is
                                                                                                                                                                                                                                                                     Contact
                                                                                                                                                                                                                             now only 16% - just 2% more than
                                          Chart 3 - Expectations Index                                                                                                                                                       the proportion thinking they will
                                                                                                                                                                                               Household Income - 6 months
                                                                                                                                                                                                                                                                     Sharon Rees
120                                                                                                                                                                                35
                                                                                                                                                                                                                             earn less.                              TNS, 222 Gray’s Inn Road
110                                                                                                                                                                                30                                                                                London WC1X 8HB
                                                                                                                                                                  % of consumers




100                                                                                                                                                                                25
                                                                                                                                                                                                                                                                     United Kingdom
 90                                                                                                                                                                                20
 80                                                                                                                                                                                15
 70                                                                                                                                                                                10
                                                                                                                                                                                                                                                                     Tel: +44 (0) 20 7160 5656
 60                                                                                                                                                                                 5                                                                                Fax: +44 (0) 20 7160 5950
                                                                                                                                                                                        Good     Bad      Net
 50                                                                                                                                                                                 0                                                                                Email: consumer.confidence@tns-global.com
                        Nov-04




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                                                                                                         So urce: TNS research f o r Nat io nwide
                                                    Nationwide Consumer                                                                                                                                                                                               Issue - July 2008


                                                    Confidence Index
        Headline                                                                                                                Expectations                                                                    Spending            Household                   Present                     Historic Scores
         News                                                                                                                      Index                                                                         Index             and property             Situation Index                and Background



The Spending Index
Opportunistic consumers see chance to make
major purchase
An 8% swing in those willing to                                                                                                                                  means that more consumers think                               Consumers appear to be tightening
buy items likes houses or cars has                                                                                                                               it’s a good time to buy than any point                        their belts once again as the number
emerged this month. The number                                                                                                                                   previously since July 2007.                                   of people who think now is a bad
thinking it’s a bad or very bad time to                                                                                                                                                                                        time to buy white or brown goods
buy has fallen 4% to 61% and those                                                                                                                               In spite of this, there was a definite                        increased from 16% to 20% in June
saying it’s a very or fairly good time                                                                                                                           shift in sentiment around the                                 – a 14% increase on last year.
to buy has risen 4% to 18%. This                                                                                                                                 purchase of household goods.



                                                                                                                                                                                                                                                                        Contact

                                              Chart 4 - Spending Index


 120
                                                                                                                                                                                                   Major Purchase - 6 months                                            Sharon Rees
                                                                                                                                                                                   80.00                                                                                TNS, 222 Gray’s Inn Road
 110
                                                                                                                                                                                   60.00                                                                                London WC1X 8HB
 100
                                                                                                                                                                  % of consumers




                                                                                                                                                                                   40.00
                                                                                                                                                                                                                                                                        United Kingdom
  90                                                                                                                                                                               20.00

  80                                                                                                                                                                                0.00
                                                                                                                                                                                   -20.00
                                                                                                                                                                                                                                                                        Tel: +44 (0) 20 7160 5656
  70
                                                                                                                                                                                   -40.00                                                                               Fax: +44 (0) 20 7160 5950
  60                                                                                                                                                                                        Good     Bad      Net
                                                                                                                                                                                   -60.00                                                                               Email: consumer.confidence@tns-global.com
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  50
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                         Nov-04




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                                                                                                 Source: TNS research f or Nationw ide
            Nationwide Consumer                                                                           Issue - July 2008


            Confidence Index
   Headline                   Expectations                            Spending      Household         Present                   Historic Scores
    News                         Index                                 Index       and property   Situation Index              and Background



House price expectations
Consumers less negative about house prices
In line with the renewed increase             next 6 months was a decline
in confidence to make major                   in price of 3.5%. However this
purchases, it seems consumers                 month they are now saying it
are starting to think less                    will decline by 3.2%. Whilst this
negatively about house price                  is obviously still negative, and
growth.                                       consumers remain subdued
                                              on the topic, this is hopefully a
Last month consumers reported                 glimpse of light at the end of the
that their expectation over the               tunnel.



                                                                                                            Contact
                     Consumer House Price Forecast - Point Estimate

           5.0
                                                                                                            Sharon Rees
           4.0
                                                                                                            TNS, 222 Gray’s Inn Road
           3.0
                                                                                                            London WC1X 8HB
           2.0
                                                                                                            United Kingdom
           1.0
           0.0
                                                                                                            Tel: +44 (0) 20 7160 5656
           -1.0
                                                                                                            Fax: +44 (0) 20 7160 5950
           -2.0
                  Point %                                                                                   Email: consumer.confidence@tns-global.com
           -3.0   3mth ave
           -4.0
                  Mar-05




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                  Dec-07
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                  Oct-07
            Nationwide Consumer                                                                                                                                                                        Issue - July 2008


            Confidence Index
    Headline                                                     Expectations                                                                                        Spending    Household         Present                   Historic Scores
     News                                                           Index                                                                                             Index     and property   Situation Index              and Background



The Present Situation Index
Confidence in the current climate stays stable
Confidence in the current                                                                       Whilst this is a positive story on
employment situation decreased                                                                  the face of it, it will be interesting
very slightly this month, with a 1%                                                             to see how the gloom surrounding
fall away from people believing                                                                 the future economic situation
there are jobs available and                                                                    impacts upon the stability of the
the same number increasing in                                                                   current situation.
those saying there are few jobs
available. There was no change
at all in confidence around the
current economic situation.


                                                   Chart 2 - Present Situation Index                                                                                                                     Contact

             120
                                                                                                                                                                                                         Sharon Rees
             110
                                                                                                                                                                                                         TNS, 222 Gray’s Inn Road
             100                                                                                                                                                                                         London WC1X 8HB
                                                                                                                                                                                                         United Kingdom
               90

               80                                                                                                                                                                                        Tel: +44 (0) 20 7160 5656
                                                                                                                                                                                                         Fax: +44 (0) 20 7160 5950
               70
                                                                                                                                                                                                         Email: consumer.confidence@tns-global.com
               60

               50
                                               Feb-05




                                                                                   Feb-06




                                                                                                                        Feb-07




                                                                                                                                                            Feb-08
                    May-04




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                                      Nov-04




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                             Aug-04




                                                                 Aug-05




                                                                                                     Aug-06




                                                                                                                                          Aug-07




                                                                                                              Source: TNS research f or Nationw ide
       Nationwide Consumer                                                                    Issue - July 2008


       Confidence Index
 Headline    Expectations    Spending          Household                              Present                        Historic Scores
  News          Index         Index           and property                        Situation Index                   and Background



Historic Scores and Background



                                        The Nationwide Consumer Confidence Index              *Note the Nationwide Consumer Confidence Index
                                        is compiled in Partnership with the Nationwide        was first published in May 2004
                                        Building Society.

                                        The NCCI is based on a similar approach to that
                                        used by the US Conference Board which produces
                                        the highly regarded US Consumer Confidence
                                        Index which has run since 1967 and is widely
                                        acknowledged as being a key economic indicator.
                                                                                                 Contact
                                        For June, the TNS research for Nationwide took
                                        place from 19 May to 22 June with 1,000 people.
                                                                                                 Sharon Rees
                                        The House Price Expectations data is based on a
                                                                                                 TNS, 222 Gray’s Inn Road
                                        balance of people who believe that house prices
                                                                                                 London WC1X 8HB
                                        will be higher in six months time against those who
                                                                                                 United Kingdom
                                        think they will be lower in six months time.

                                        Indices are produced using a mix adjusted                Tel: +44 (0) 20 7160 5656
                                        Nationwide Consumer Confidence Methodology               Fax: +44 (0) 20 7160 5950
                                        which was introduced with effect from June 2008.         Email: consumer.confidence@tns-global.com
                                        Indices are seasonally adjusted using the US
                                        Bureau of the Census X12 method. Currently the
                                        calculations are based on a monthly data series
                                        starting from May 2004. Figures are recalculated
                                        each month which may result in revisions to
                                        historical data.

				
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