Consumer confidence increases amid Christmas cheer

Consumer confidence has increased amid Christmas cheer in a small but much-needed boost for retailers, figures show.

GfK’s long-running Consumer Confidence Index increased two points in December but remains firmly in negative territory at minus 22.

Expectations for the general economic situation over the next 12 months increased by one point to minus 25 but has risen to 28 points higher than a year ago.

Notably, confidence in personal finances – reflecting household financial optimism and control over budgets – has recovered from the depressed minus 29 of a year ago to minus 2.

The major purchase index, a mark of confidence in buying big ticket items, also rose, by one point to minus 23.

Joe Staton, client strategy director at GfK, said: “Against the backdrop of flat-lining economic growth, interest rates at a 15-year high, and price rises potentially eroding disposable income for years to come, the Consumer Confidence Index shows a modest improvement this month with gains across all key measures.

“Although the headline figure of minus 22 means the nation’s confidence is still firmly in negative territory, optimism for our personal finances for the next 12 months shows a notable recovery from the depressed minus 29 reported this time last year.

“Despite the severe cost-of-living crisis still impacting most households, this slow but persistent movement towards positive territory for the personal finance measure looking ahead is an encouraging sign for the year to come.”