Consumer confidence has rocketed this month, up eight points to -22, the highest reading in 18 months, figures released today reveal.
According to the GfK/NOP Consumer Confidence Index, this represents the seventh biggest monthly increase since the measure began in 1974, emphasising the significant of the surprise surge.
Confidence in the general economic situation over the coming 12 months has rocketed 14 points in November to -15, an 18 point boost on the same month last year while the measure focusing on the past 12 months has improved by nine points to -44, up 17 points on November 2011.
This follows news that the CBI’s latest quarterly Distributive Trades Survey found that retail sales volumes saw a boost this month as shoppers prepared for Christmas.
In terms of personal finances, the forecast for the next 12 months grew six points to -7 which is up three points on this time last year while the measure for the previous year increased three points to -21, two points higher than the same period last year.
GfK’s managing Director of Social Research Nick Moon welcomed the boost, commenting: “This is an unexpected rise in consumer confidence and comes despite uninspiring economic news recently.
“The improvement is especially dramatic following such a stagnant summer and represents the seventh highest increase since the Index began in 1974.
“The improvement in consumer confidence will be especially welcomed by retailers as the figures show that people are increasingly optimistic about how the economy will perform over the next twelve months.
“This could be because consumers now think things can’t get any worse or it may be for more positive reasons, but either way it is good news as we look ahead to 2013.”
As Christmas approaches, the index found that the measure for major purchases jumped seven points to -26 this month, up one point on last year while the savings index also rose one point to -16, a three point decline on last year.
Looking ahead, Moon said: “The direction things head in the New Year will be crucial in determining whether this is a short-term spike or the start of a long-term improvement in people’s spending habits.
“When we saw a significant improvement like this in May 2011 the surge ebbed away over the following few months as the country returned to recession. Hopefully this spike is built on firmer foundations.”