Consumers in Europe reported mixed feelings about the economy in August. Those feelings manifested into a range of behaviours—for example, price became a more important factor in purchase decisions. A greater emphasis on the omnichannel experience, as well as health and environmental considerations, also characterised European consumer behaviour in the third quarter of 2023. The latest ConsumerWise research by McKinsey was held in five European countries: France, Germany, Italy, Spain, and the United Kingdom.

Consumer optimism held steady as mixed feelings grew. Consumer optimism did not change, while mixed feelings about the economy grew in the third quarter of 2023. This came after a significant increase in optimism in the preceding quarter. Price stabilisation and a continuing economic recovery helped maintain optimism. Germany experienced a slight decline in consumer confidence, while Spanish consumers expressed increasing confidence.

Inflation remained the top concern for two-thirds of consumers. More European consumers expressed concern over climate change in the third quarter, up four percentage points from the previous quarter—feelings that may have been driven by natural disasters such as heavy rains and wildfires in southern Europe. Ongoing geopolitical turmoil, continued interest rate hikes, and increasing heating and electricity costs have all further affected consumer confidence.

Younger consumers and higher-income consumers reported the highest confidence in a rapid economic recovery, consistent with what these groups have expressed over the past two years.

Source: McKinsey