Consumer optimism appears to have peaked indicating a positive trajectory for the economy.
According to the Confidence Index by market research firm GFK, there has been a four-point uptick in consumer confidence this month, resulting in a net score of -21, marking the most favourable reading since January 2022.
In a surprising turn of events, the Office for National Statistics (ONS) has reported a decrease in inflation last month, dropping from 6.8% to 6.7%. Furthermore, on 21 September 2023, the Bank of England opted to maintain interest rates at 5.25% instead of implementing further increases.
GFK conducted a survey of just over 2,000 individuals before both of these announcements were officially released, indicating that the next iteration of the index is likely to show further improvement.
Joe Staton, Client Strategy Director at GFK, commented:
“The view on our personal financial situation for the past year and the next is registering marginal but welcome growth, while expectations for the UK’s wider economy in the coming year show a more robust six-point increase.
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.”