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UK consumer confidence rebounds

News, 30 September 2016

LONDON: UK consumers appear to have shrugged off any post-Brexit concerns as confidence has returned to June's pre-Brexit levels, according to new figures from GfK.

The research firm's long-running Consumer Confidence Index, based on five different measures, increased by six points in September to -1, reversing the dramatic collapse seen in the immediate wake of the referendum result.

Joe Staton, Head of Market Dynamics at GfK, said the turnaround was "driven by improved expectations in our personal financial situation, perceptions of the general economic situation and intentions to make major purchases".

The index measuring changes in personal finances during the last 12 months increased by two points to +2 – one point higher than September 2015 – while the forecast for personal finances over the next 12 months increased by three points this month to +7 – again, one point higher than this time last year.

Optimism about personal finances was accompanied by a lifting of the gloom about the wider economy: expectations for the general economic situation over the next 12 months increased 13 points to -9, although that was still seven points lower than September 2015.

The major purchase index, meanwhile, was up two points to +9, five points lower than this time last year, and the savings Index was six points higher at -9, 12 points lower than September 2015.

UK consumer confidence is not matched by marketers around the world, however, as the September headline Global Marketing Index, from World Economics, fell for the fourth month in a row and now stands at 52.4 (where 50 indicates no change).

The Global Marketing Budgets Index – one of three factors that make up the headline figure – fell under 50.0; at 49.5 this was the first fall after nearly four years of growth.

Budgets were reduced in all regions apart from Europe where an index of 51.0 (representing insipid growth) was recorded although the index fell in value for the six consecutive month.

The Global Trading Conditions Index also fell in September, but the Staffing Index, which reflects the number of staff taken on compared to the same period last year, saw growth globally with an index value of 55.1.

Data sourced from GfK, World Economics; additional content by Warc staff