UK consumer confidence sees unexpected bounce - GfK

By

Sandra Halliday

Published
Aug 31, 2017

UK consumer confidence has been bouncing around a lot lately with consumers feeling good one minute and bad the next. So what happened in August?

According to GfK, the confidence level bounced back from a -12 low inJuly to a better-but-not-great -10 this month. All five measures increased this month, with ‘personal financial situation over the last 12 months’ registering the biggest rise of four points to reach +2. Also good news, the forecast for personal finances over the next 12 months increased three points this month to +5, one point higher than August 2016.  

But while the measure for the General Economic Situation of the country during the last 12 months increased one point, it’s only -30 and this is seven points lower than August  2016. And expectations for the General Economic Situation over the next 12 months have increased one point too, they’re only at -27, five points lower than this time last year.

The Major Purchase Index increased one point this month but only to 0 and that’s seven points lower than August 2016, while the Savings Index has increased one point to +6. That’s 21 points higher than August 2016 so consumers are clearly saving for the rainy day they expect to come.

The researcher, which compiles confidence figures Europe-wide for the EU, did ask whether we’re seeing a ‘dead-cat bounce’ or a temporary jump that will fall back when the grey days of September appear.

GfK didn’t completely answer its own question but Joe Staton, Head of Market Dynamics at the firm, said: “UK Consumer Confidence rebounded this month after the score we reported in July that matched 2016’s post-Brexit low.

“We’re seeing an uptick in August among consumers when reviewing their personal financial situation for both the past and next 12 months, as well as a slight improvement in views about the general economic situation of the country as a whole.”

But he said these figures must be seen against the backdrop of better news on inflation, public finances, jobs and growth prospects as the UK economy displays some signs of stability after a volatile start to the year.
And he stressed that the Index has a lot of ground to regain to get back into the black.