Is Consumer Confidence on the Rise?

The last time a three-month consecutive improvement was seen in the GFK’s consumer confidence index was 2014. However, six years on and things are looking good.

A rise in wages and house prices, as well as a decrease in unemployment, has seen consumer confidence leap forward by two points to -7 in February. This was an increase for the third month in a row.

The increase has come from a change in attitude towards the economy in the UK for the last 12 months and upcoming 12 months. Along with this, the score for the general economic situation in the UK has increased by five points. As well as this, consumers expect the economic situation to improve again over the next 12 months too.

However, in contrast to this, the measure of personal finances over the last 12 months has dropped by 2 points while it is looking likely that no changes are going to occur over the next 12 months. While consumers have shown that they are concerned about their finances, there has been an increase in the major purchase index from 1 point to 6, a result that comes from a recent rebound in retail sales.

So, on the whole, consumers are looking at the economy in a positive light over the past year and the year ahead. They are now more likely to make major purchases of items such as electrical items or furniture and that is a real positive for brands and marketers. This three monthly sequence of increases has not been seen since 2014 and that is good news. While this is great news, the economy in the UK has a huge hurdle to overcome in the form of the coronavirus. Nobody knows for definite how this will impact the economy in the UK but with airlines already cancelling flights, it seems as though the light at the end of the tunnel might be disappearing for the time being.

The impact of Coronavirus is still an unknown quantity but there will be definite concerns from consumers and business alike. As a result, this could put a stop to the way in which consumers are growing in confidence.