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Consumer confidence in personal finances keeps growing in the UK

Consumer confidence in personal finances keeps growing in the UK
Matt Browning
Written By:
Matt Browning
Posted:
24/05/2024
Updated:
24/05/2024

The UK’s consumer confidence grew again in May, as people continued to see a brighter future for their finances.

Taking into account people’s feelings on their economic situation, there was a two point increase during the month, which scored a total of -17 on the Consumer Confidence Index from GfK.

The mood on personal finances improved by one point in May to -10, which is 10 points better off than at the same time last year.

For the next 12 months, the 2,000 respondents surveyed were generally optimistic towards their personal finances too, with it growing by five points on the index to stand at seven points.

There was also more confidence that people had for the general economic situation of the UK, with the score rising by two points to -39, which is 15 points more than in May 2023.

Looking ahead, consumer confidence surged by four points to -17 when respondents were asked to rate the nation’s future as either ‘a lot better’, ‘a little better’, ‘stay the same’, ‘a little or a lot worse’.

When asked “do you think now is the right time for people to make major purchases such as furniture or electronic goods?”, the consensus was that it is not. The score for this measure decreased by one point to -26, which is two points lower than in May 2023.

While not included in the data firm’s overall index, savers’ thoughts on whether now is a good time to add to their funds were encouraging, with confidence rising by one point to equal 27 – eight points higher than last year.

‘Customers sensing that conditions are improving’

Following on from the positive consumer confidence results in April, Joe Staton, client strategy director at GfK, believes May has provided “another strong showing” for the UK.

Staton said: “The only negative in May is the slight dip in our major purchase measure (down one point to -26), reinforcing the fact that the cost-of-living crisis is still a day-to-day reality for all of us.

“However, with the latest drop in headline inflation and the prospect of interest rate cuts in due course, the trend is certainly positive after a long period of stasis [that] has seen the overall index score stuck in the doldrums.”

Staton added: “All in all, consumers are clearly sensing that conditions are improving. This good result anticipates further growth in confidence in the months to come.”