- GfK’s UK consumer confidence barometer rise by two points to -7
- Britons’ view of UK economy remain ‘resolutely downbeat’ at -24
- Shoppers cautious as major purchase index drops two points to +1
Confidence among British consumers rose this month thanks to a better outlook on personal finances, but perceptions over the state of the UK economy remained ‘resolutely downbeat’, new figures show.
GfK’s UK consumer confidence barometer rose two points as Britons seemed to be more upbeat about their own financial situation – although it still remains in negative territory at -7.
What weighs most on the overall figure is Britons’ view of the general economic situation of the country, as this measure continues to remain ‘resolutely downbeat’ at -24. While this marks an improvement from last month, it is still worse than last May’s -20.
Grey days: Britons’ view of the UK economy is worse than last year
Consumer confidence has been at zero or in negative territory for over two years now as uncertainty stemming from the Brexit referendum has taken a toll.
Sentiment about the UK’s economic situation over the next year has improved, GfK said, reaching the same level as May last year at -21.
However, a two point drop in the major purchase index to +1 suggests consumer spending, which is the main driver of the UK economy, is not likely to improve as Britons are careful about making big purchases.
Joe Staton, client strategy director at GfK, said: ‘These negative economic scores are depressing the overall index and preventing it from breaking out into positive territory.’
‘We have been at zero or negative for 29 months now. When will the strong jobs market and rising real incomes, coupled with ongoing low interest rates and low levels of headline inflation, have an impact?’
‘With UK retail sales falling at their sharpest rate since the mid-90s, tough trading conditions for Britain’s hard-pressed retail sector continue to take their toll.’
The survey of about 2,000 people comes as the Bank of England recently slashed its economic growth forecast for 2018.
After a slew of poor economic data, the central bank now expects the UK economy to grow by a paltry 1.4 per cent this year – markedly lower than the 1.8 per cent it had previously pencilled in.