UK consumer confidence rises to best level in two years

The overall index score for consumer confidence improved three points to -19 in December, according to the latest GfK Consumer Confidence Index.

All five indexes measuring consumer confidence were up compared with last month as “consumers appear to be encouraged by the positive news about falling inflation.”

The index measuring consumers’ confidence in their personal financial situation over the past 12 months rose two points to -12. Looking ahead to the next 12 months, it increased two points to 0.

Consumer confidence in the general economic situation over the past 12 months increased three points to -41 and increased four points to -21 when looking at the next 12 months.

The major purchase index grew three points to -20, while the savings index remained flat over the 12 months at 27 points, but 13 points higher than this time last year. 

Joe Staton, client strategy director at GfK, says: “Consumer confidence has started the year well with all measures up and a headline score of -19, the best since January 2022. Importantly, the view on our personal financial situation for the coming year has gained two points and now stands at zero.

“This is exciting as it ends 24 consecutive months of negative scores for this measure and this significant change is the best single indicator for how the nation’s households feel about their income and expenditure.

“Despite the cost-of-living crisis still impacting many households across the UK, consumers appear to be encouraged by the positive news about falling inflation.

“On balance, while there is national and global turmoil, the Consumer Confidence Index has started 2024 on a positive note – let’s see if this optimism continues.”