Consumer confidence set to rise despite ‘Brexit saga’

Consumer confidence is expected to rise in spite of the ongoing Brexit saga, which will finally see the UK leave the European Union tonight.

The GfK Consumer Confidence Index has once again risen to -9 this month, up from -11 in December and -14 in November. Although the index has been in the negative for four years, the increase has created optimism that consumer confidence will steadily rise.

Four of GfK’s five sub-indices rose, with confidence about current personal finances in the year ahead seeing the largest increase of 4 points. Feelings for next year’s personal finances and the economy also both rose three points from 3 to 6 and -24 to -27 respectively.

Joe Staton, client strategy director at GfK, tells Marketing Week: “December gave us a seven-point improvement in how we see the economy shaping up in 2020. Add that to January’s boost in the same measure and we have a 10-point jump in just two months – from -34 to -24.”

He notes the rise is particularly significant because “views on our wallets held up pretty well throughout the Brexit saga.”

However, retailers should remain cautious as people are still less inclined to spend. The survey found that the major purchase index decreased two points in January to +1 – one point lower than this time last year.

Despite this, Staton is optimistic. He says: “Our prediction for 2020 is that there will be much more optimism on the economy. Once that happens, we’ll see higher levels of consumer confidence.”

The UK Consumer Confidence Survey was conducted among a sample of 2,008 individuals aged over 16-years-old on behalf of the European Commission.