UK consumer morale slides to lowest since mid-2023, surveys show

April 20 (Reuters) - British consumer morale ‌last month hit ​its ​lowest level since mid-2023, according to two surveys on Monday, reflecting the impact of the conflict in the Middle East.

Inflation in Britain - already the ‌highest among the Group of Seven advanced economies - looks set to rise ⁠further, and investors consider the country is especially exposed to the energy price surge that followed U.S.-Israeli ‌attacks on Iran that began ‌at the end of February.

Data company S&P Global said its consumer sentiment index fell to 42.3 from 44.1, a 33-month low, while accountants Deloitte said its quarterly ​gauge of confidence sank to its lowest since the third quarter of 2023.

Both reported a deterioration of morale around household finances and job security.

IRAN VOWS RETALIATION ⁠AFTER SHIP SEIZED

Concerns grew on Monday that the ceasefire between the United States and Iran might collapse after the ​U.S. said it had seized an Iranian cargo ship that tried to run its blockade and Iran said it would retaliate.

"Many (consumers) were ​already facing a squeeze on their household budgets at ‌the start of the year with the slowing of wage growth and a cooling jobs market," said Céline Fenech, consumer insight lead ⁠at Deloitte UK.

"For consumer sentiment and spending to improve, households will want to see a more certain outlook for the economy."

The housing market has also shown signs of weakening.

Separate data from ⁠online property portal Rightmove showed asking prices for British homes rose by 0.8% month-on-month in April, ​a smaller-than-usual increase when activity often increases.

"With mortgage rates remaining elevated due to the war in Iran, it's not a surprise that price growth is proving strongest in parts of the market less ‌exposed to higher borrowing costs, such as top-of-the-ladder homes, while sectors more exposed to interest rates are seeing slower momentum," said ‌Colleen Babcock, property expert at Rightmove.

S&P Global said more than half of households expect the ⁠Bank of England will raise interest ‌rates. BoE Governor Andrew Bailey ​had said earlier this month that investors were getting ahead of themselves by pricing in interest rate hikes.

(Reporting by Andy Bruce; editing by ‌Barbara Lewis)

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