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Consumer confidence rises despite tough economic conditions

Rebecca Goodman
Written By:
Rebecca Goodman
Posted:
Updated:
14/11/2023

There was a four-point boost to consumer confidence in September as inflation continued to fall.

Yet it still remains in negative figures, at -21, although this is the highest it’s been since January 2022, according to GfK’s consumer confidence Index.

“While this month’s improved headline score is good news, it’s important to note many households are still struggling with the cost-of-living crisis and that economic conditions are tough,” said Joe Staton, client strategy director for GfK.

It comes as inflation continues falling, although at 6.7% it is still above the Government’s target of 2%, and the Bank of England (BoE) decided to hold rates yesterday, rather than increasing them as expected.

Within the index are five key measures which record how consumers feel about the economy and their own personal finances.

When asked about the general economic situation of the country during the last year, the overall score was -47, although this was a five-point improvement from August and a 25-point boost on September 2022.

Looking forward, the score for expectations of the economy in the next 12 months was -30, six points higher than in August and 44 points higher than a year earlier.

The only measure to be in positive figures was the savings index, which was at +27, the same figure as it had been in August, and 16 points higher than a year ago.

Positive signs for Christmas

The major purchase index, which looks at how confident people are feeling about buying big-ticket items also increased, to -20, up four points monthly and 18 point yearly.

Staton added: “With less than 100 shopping days to Christmas, the four-point boost to the major purchase measure might offer some hope to retailers, who know all too well that many people face financial pressure in the run-up to this year’s festive season.”