// GfK’s latest consumer confidence index edges up two basis points to -7 this July
// The major purchase index has also increased by 7 points to 2 this month
UK consumer confidence rose for the sixth month in a row in July, driven by the economy recovering much faster than initially expected.
GfK’s latest consumer confidence index edged up two basis points to -7 this month, marking the strong improvement in households’ outlook since the initial easing of Covid-19 restrictions in mid-April.
The index is now 20 basis points higher than it was a year ago.
- High street recovery stutters after initial surge in footfall
Meanwhile, GfK’s major purchase index has increased by seven points to 2 in July.
“Consumer confidence edged ahead of its March 2020 pre-lockdown headline score by two points to -7 in July and has held firm or improved for six months in a row,” GfK client strategy director Joe Staton said.
“Personal finance expectations for the next year remain strong and there’s a dramatic jump this month in our major purchase sub-measure with shoppers agreeing that now is the ‘right time to buy’.
“The healthy seven-point rise aligns with strong retail growth figures that reflect the gradual unlocking of the UK high street and release of pent-up demand as Brits hit shops, restaurants and venues.”
GfK said threats from increasing consumer price inflation, Covid variants and the end of furlough and the Job Retention Scheme could result in the rebound stalling.
“Consumers are aware of these pressures judging from the latest fall – from -2 to -5 – in how they view the general economy in the year ahead,” Staton said.
“What happens across the remaining summer months will frame consumer confidence for the rest of 2021 and beyond.”