GfK’s consumer-confidence barometer was at minus 23 in February, the highest since the pandemic hit the country
Consumer Confidence in the UK increased in February on a sharp rise in economic expectations over the next year amid swift deployment of Covid vaccine.
The survey by German market research firm GfK, polled 2,000 individuals between Feb. 1 and 12, amid a continued decline in the number of Covid-19 cases and hospitalizations across the country.
GfK’s consumer-confidence barometer sat at minus 23 in February, five points higher than the previous month and the highest level since the coronavirus pandemic hit the country.
The reading is higher than those forecast by economists polled by The Wall Street Journal, who expected the barometer to be minus 25.
Consumer confidence in the UK had largely moved sideways since April, when it slumped due to a standstill in activity amid initial lockdown measures taken in spring. Despite February’s gain, the index is still well below its prepandemic level of minus 9.
The data showed that February’s rise in consumer confidence was boosted by a 14-point jump in Britons outlook of the economy for the coming year.
GfK’s Client Strategy Director Joe Staton said that, while it would be tempting to talk of a return to normality, there are still challenges ahead and the overall five-point recovery might not be enough for the index to spring back to life.
We need to be cautious because the positive tailwinds of the vaccination rollout are being met by the very strong headwinds of unemployment, the threat of inflation and the difficulty that many face in affording day-to-day living costs–all serious issues that can dampen consumer confidence, he said.
While four out of the five measures that constitute the consumer-confidence barometer were up compared with the previous month, one remained unchanged.
Apart from the surge in economic expectations for the coming year, households’ assessment of the general economic situation for the past year rose by three points, along with the major purchase index–which gauges demand among shoppers and increased by five points– as well as consumers’ outlook on their personal financial situation over the coming year, which was up two points.
Perhaps the key lies in the healthier score for how we see our personal finances going forward as this will impact our spending plans that in turn will fuel the postpandemic economy, Mr. Staton said of the slight uptick in expectations of personal finances index.
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