UK consumers became slightly more confident this month than they were in February, cheered by the prospect of wages inching higher, inflation easing slightly and progress being made on Brexit negotiations, a survey shows.
The GfK UK consumer confidence index rose to a score of minus 7 for March, which was up from a score of minus 10 in February and minus 9 in January.
The monthly questionnaire, which has been running since 1974, examines how consumers rate their personal financial situation and the general economic situation over the last 12 months and over the coming twelve months. It also takes in account how likely consumers are to make a major purchase.
March’s index rose for all five measures. The largest increase was seen in the way that respondents expect their personal financial situation to unfold over the coming year.
“Spring is in the air with increases across the board on personal finances, the general economy – over the last year and next year – and on current major purchase intention,” said GfK’s Joe Staton.
“The prospect of wage rises finally outstripping declining inflation, high levels of employment with low-level interest rates, and finally some movement on the Brexit front appear to have boosted our spirits,” he added.
“It’s still a little early to be talking about green-shoots, and the core score is of course still negative, but this is definitely a movement in the right direction. Consumers are feeling a tiny spring in their step – let’s see next month if April showers dampen the mood,” he said.
Data published earlier this month showed that wages grew at their fastest rate in more than two years in January.
The Office for National Statistics (ONS) reported that total average weekly earnings in the three months to January were up 2.8 per cent year-on-year, the fastest rate of growth registered since September 2015.
Consumer price inflation was 3 per cent in January, meaning real wages still fell in that month, but since then inflation has eased back.