The UK Consumer Confidence Barometer, conducted by GfK on behalf of the EU, has increased three points this month to 0, leaving negative territory for the first time in over nine years.
Nick Moon, MD of social research at GfK, comments: “A rise of three points in the index in a month is itself a significant change, but what matters more, psychologically at least, is that the index has left negative territory for the first time in over nine years. It is not actually positive, standing as it does at 0, but this is the first time it has reached 0 since April 2005.
"Over the last 14 months the index has risen a remarkable 27 points since April 2013 – the biggest gain since June 1977 when the index jumped 34 points from -14 to +20 in a seven-month period (June 1977 to December 1977).
"Although all the individual elements of the index rose this month, the real driver of the increase is people’s assessment of the general economic climate. There was a massive eight-point jump in the retrospective assessment of the last 12 months and a four-point increase in confidence about the next 12 months. Perhaps not surprisingly, given Labour’s campaigning about the decline in real incomes, people’s verdict on their own circumstances were less positive, with each rising by a somewhat anaemic one point.”
To break down GfK's findings, the overall index score increased by three points to 0 this month, and all five measures saw increases this month.
The index measuring changes in personal finances during the last 12 months has increased one point this month to -10 – this is 10 points higher than May 2013. The forecast for personal finances over the next 12 months has increased one point this month to six, 11 points higher than this time last year.
The measure for the general economic situation of the country during the last 12 months has increased eight points this month to -5 – this is 39 points higher than May 2013. Expectations for the general economic situation over the next 12 months have increased four points this month to 12, 30 points higher than this time last year.
The ‘climate for major purchases’ index has increased one point this month to -3, 22 points higher than this time last year.
The ‘now is a good time to save’ index has decreased one point this month to -9, 12 points higher than May 2013.