UK consumer confidence fell to 42.7 in September from 42.9 in August, reflecting growing concerns about higher interest rates, mortgage costs, living expenses and job security. The deterioration comes ahead of John Healey’s budget, where tax rises are reportedly being considered as government borrowing costs increase amid Middle East tensions.

More than half of 1,500 survey respondents expected borrowing costs to rise over the next year. Average two-year and five-year fixed mortgage rates reached 5.88% and 5.92% respectively, while a typical £250,000 mortgage has become about £150 more expensive per month since March; meanwhile, payroll employment and vacancies have fallen, and only 17% of 5,000 surveyed businesses planned to increase investment.