Consumer confidence dropped in July as a result of concerns about a potential financial meltdown caused by instability in Greece.

The GfK’s UK consumer confidence index decreased by three points in July and is now 10 points lower than this time last year.

GfK head of market dynamics Joe Staton said: “Driven by anxiety over the potential Grexit meltdown and global uncertainty, consumers are feeling less secure about wider economic prospects for the country as a whole this month.”

Interviews for the most recent index happened between July 1 and 15, while Greece agreed a third bailout deal with Eurozone leaders on 13 July, which helped prevent the country exiting the EU.

Staton added: “On a more personal level, consumers remain resolutely upbeat about their own financial situation for the coming 12 months.”

People are feeling upbeat about their personal finances as wage inflation outstrips price inflation.

GfK forecasts consumer confidence will increase over the coming year because of “improving growth and employment prospects”.

Staton added: “Despite this month’s dip, the underlying message is strong.”

The major purchase index, which measures the public’s willingness to splash out on big-ticket items, dropped five points in July. However, it is still 14 points higher than this time last year.