Consumer confidence saw a slight uptick during February, recording a five point recovery that suggests a cautiously optimistic outlook for the UK economy.
The latest GfK Consumer Confidence Index saw four measures on the increase compared with last month, which would normally be some cause for celebration, particularly given the torrid time endured by both consumers and businesses over the past year. However, the Overall Index Score remains decidedly downbeat at -23.
One notable statistic is the 14 point increase in expectations for the general economic situation over the coming 12 months. With the vaccination rollout continuing at pace there is optimism, but that’s tempered by the fact sentiment about the general economic situation still remains nine points lower than the same time last year.
Equally, although the measure for the economy during the past year is up by three points and now stands at -64, it’s still a full 41 points lower than in February 2020.
“After the cold spell and snow in the opening days of February it’s good to get at least a faint note of warmth in our consumer confidence numbers this month,” GfK client strategy director Joe Staton tells Marketing Week.
“There’s a robust jump in how people are viewing the economy – up from -44 last month to -30 this month. Intentions around major purchases are up five points to -19.”
Personal finance over the past year remained flat at -8, but there was an uptick in sentiment of two points to 4 looking ahead to the coming 12 months, reinforced by a five point boost for major purchase intentions.
However, that’s still two points lower when compared to same time last year, and Staton stresses that we’re a long way from any kind of recovery. “Keep in mind though that four out of five of our sub-measures are still in negative territory and our view on the economy over the past year is particularly depressed at -64,” he says.
“It will take a long time before people can look back 12 months and declare that the general economy has got better.”
Elsewhere, the Savings Index remains in relative good health, up by one point to 19. That’s just one point lower than in February 2020.
Staton takes some encouragement from the latest GfK report, but advises that any hopes of recovery over the coming weeks and months will be heavily bound up with how the government continues to handle the vaccination programme and gradual lifting of social restrictions.
“If the vaccination programme continues to build momentum and has the desired effect, and if we get the lockdown exit strategy right, we can cautiously expect consumer confidence numbers to improve further,” Staton adds.