A new survey shows that British shoppers are more confident this month than expected because the relaxation of coronavirus rules has boosted their mood and willingness to spend.
Research firm GfK said on Friday that the UK Consumer Confidence Index, a monthly indicator of how people view personal finances and broader economic prospects, rose by 2 percentage points to minus 7 in July. This keeps the index above the pre-pandemic level passed last month.
The results based on interviews conducted in the first two weeks of July reflect the government’s decision to fully restart the economy on July 19. The confidence index is stronger than the negative 8 predicted by economists surveyed by Reuters, and marks an almost uninterrupted improvement starting from the negative value. January 28.
Joe Staton, director of customer strategy at GfK, pointed out that this month’s index tracking people’s belief that this is a good time to make bulk purchases has seen a “dramatic” jump, reflecting the “gradual unlocking and repressed release of British commercial streets.” As people return to shops, restaurants, and other places, demand increases.
Consumers’ perceptions of personal finances are still very high, coupled with rising spending willingness, they indicate that UK spending is recovering healthily.
Even if consumers are aware of the risks facing the economy, the mood of shoppers has improved. Expectations for the overall economic situation in the coming year fell by 3 percentage points from the previous month.
“The threats from rising consumer prices, Covid-19 variants and rising numbers of infections [and] The vacation and job retention programs are coming to an end and may prevent this rebound,” Staton warned.