Use of English

Confidence and the Economy

When the news is full of rising prices and job cuts, it is hardly surprising that many people (0) FEEL less confident about spending. Consumer confidence is not just a personal mood; it is closely linked to economic trends that affect everyday life. For example, when inflation goes up, households often have to cut (1) .......... on non-essential items, even if their salaries rise slightly. At the same time, if interest rates increase, paying back loans can become more (2) .......... , which makes people think twice before buying a car or moving house. In contrast, when unemployment falls and wages grow steadily, shoppers are more likely to (3) .......... out on treats and plan bigger purchases. However, confidence can change quickly. A single negative headline may (4) .......... doubts, while a strong economic report can (5) .......... spirits almost overnight. Governments and central banks try to keep the situation stable, but their decisions do not always have the (6) .......... effect. In the end, what matters is whether people believe the economy is heading in the right (7) .......... and whether they expect their own finances to (8) .......... up in the months ahead.