Data released on Friday showed consumer confidence in the UK rebounded to its highest level in almost a year in February, showing households have rebounded despite the cost of living crisis.
Research group GfK has released its Consumer Confidence Index. economic outlookrose 7 points to -38.
It’s the highest since April 2022 for the index, which topped the consensus forecast of -43 and fell to a near-record low in January. However, the measure remained well below zero, indicating that most respondents reported lower self-confidence.
Joe Staton, GfK’s director of client strategy, said that while February’s scores were “remaining severely depressed,” consumers were “suddenly optimistic about their personal finances, especially next year, and the economic situation in general. I showed my point of view,” he said.
Respondents to the survey, based on interviews conducted between February 1 and 13, said they expect more out of the future as the sub-index, which measures their general outlook on future economic conditions, jumped 11 points between January and February. I was more optimistic about the year.
Consumers also report a renewed confidence in their personal finances and an increased willingness to make expensive purchases.
The Savings Index, which measures how likely consumers are to throw away money but isn’t included in the overall score, rose from 14 to 19, five points higher than last February.
The rise in all five indicators included in the overall index suggests consumers may experience a “softer recession than experts predicted,” Staton said.
The survey follows a series of encouraging official data, showing that the UK avoided contraction in the fourth quarter of 2022, while the labor market remained resilient despite economic headwinds.
headline inflation Decreased to 10.1% in Januarydown from a 41-year peak of 11.1% in October, the National Bureau of Statistics said last week.
On the other hand, finance A staggering £30 billion unexpected profit With the fiscal year ending January, the ONS said on Tuesday that it will give Prime Minister Jeremy Hunt room to provide additional support to households in the March 15 spring budget.
Overall, consumer confidence in February was 12 points lower than the same month in 2022, as higher energy prices and higher interest rates and food prices weighed on household budgets over the past 12 months.
“[Consumer] Moods and the economy are far from pre-lockdown levels,” Staton said, adding, “But we may need a little consumer resilience to soften the recession in 2023.”
