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Economy

UK consumer confidence rises in June

GfK’s long-running Consumer Confidence Index increased by six points to -30 in June.

The measure for the general economic situation of the country during the last 12 months has improved by one point to -59, but is still 27 points lower than in June 2019.

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Expectations for the general economic situation over the coming 12 months were also up by nine points to -48 points.

Additionally, the Major Purchase Index increased nine points to -32 in June, 30 points lower than the same period last year.

Joe Staton, GfK’s client strategy director, said that due to all of the measures rising during the month, there has been a “particularly strong increase in future perceptions of personal finances and the economy”.

However, he noted that it’s still “a story that’s about negative numbers” and added it is “too early to say that consumers are moving on from the Covid-19 crisis”.

Staton said: “The initial fall we announced on 6 April (-9 down to -34) was the biggest ever since this survey’s origins in 1974. You have to go way back to the 1979 oil crisis to find anything that comes close. This latest improvement may be misleading.

“Consumers appear to be confused and some are not sure what to think. Yes, we have seen queues as some shoppers return to battered high streets.”

He added: “But with economists warning that the post-lockdown upturn might not restore GDP to pre-Covid-19 levels, and with the labour market set for more job losses, we have to question whether we are seeing early signs of economic recovery or that infamous ‘dead cat bounce’. Most bets will be on the dead cat.”

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