The additional easing of Covid-19 restrictions has boosted UK consumer confidence back to pre-lockdown levels, according to the latest GfK Consumer Confidence Index.
The figures show the index has increased by six points in May, to -9. Since April, three of the five measures used to create the index have risen, while one has fallen and one remains flat.
There is also hope for the first time since the pandemic began that consumer confidence will return to a positive score later this year.
The index measuring consumers’ views of their personal financial situation over the last year has fallen one point this month, to -4. This is the same level recorded in May 2020. But consumers are far more confident in how they will fare over the coming year, recording a score of 10, which is the same as April.
People’s view of the general economic situation over the past year is up 10 points to -48, while consumers’ view for the coming year is up 15 points to 4, a marked improvement from the score of -54 recorded in May 2020.
The major purchase index is up 5 points to -7, a full 40 points higher than it was this time last year.
“The last time consumer confidence was in positive territory was in January 2016. Based on the excellent progress we have seen since January with an increase every month, it’s tempting to see consumer confidence breaking into positive territory this summer,” GfK client strategy director Joe Staton tells Marketing Week.
“The Bank of England told us this month that the lifting of Covid-19 restrictions will help the UK economy in 2021 see its speediest growth for 70 years. If this happens, it can only be a major catalyst for consumer confidence,” he adds. “The only stumbling block for this encouraging prospect could be the spread of the Covid-19 Indian variant in the UK and this needs to be monitored carefully,” he adds.