Consumer confidence sees subdued increase amid ‘wait and see’ stance

Consumer confidence has seen a subdued increase amid a “wait and see” stance on the economy, figures suggest.

GfK’s long-running Consumer Confidence Index increased by one point to minus 13 in July.

A seven point uptick in the major purchase index – an indicator of confidence in buying big ticket items, was potentially good news for retailers, that could translate into improved footfall in the months to come, GfK said.

While the view on personal finances over the last year was up two points to minus eight – its highest point since January 2022 – consumers’ confidence in the same measure looking ahead 12 months was less positive, falling one point to positive three.

Confidence in the UK’s wider economy over the next 12 months has paused, at an identical minus 11 to last month.

Joe Staton, client strategy director at GfK, said: “There was a subdued one-point improvement in the overall index score in July, with only two of the five measures increasing.

“Two important events during the survey period – the UK general election result on July 5, and England sealing its place on July 10 in the Euro 2024 final – could have boosted the national mood but appear to have had limited positive impact.

“So, July’s consumer confidence poll suggests a note of caution as people wait to see exactly how the UK’s new Government will affect the wider economy and their personal finances.”

Linda Ellett, UK head of consumer, retail and leisure for KPMG, said: “Consumer confidence levels continue to be governed by this higher cost environment and whether households have been able to absorb the likes of mortgage and rent increases, or have had to significantly adapt other areas of their spend.

“KPMG research shows that four in 10 people say they’ve cut their non-essential spend further in 2024, leaving as many people feeling less confident about their financial security as the year has progressed as those who are feeling more confident.

“Among those choosing to spend, holidays, TVs and mobile phones ahead of the summer of sport, and experiences such as gig tickets have all brought a degree of boost to retail, hospitality and leisure parts of the economy.”