Source: Sharecast
The latest consumer confidence index from GfK, part of the Nuremberg Institute for Market Decisions, came in at -13, up one point on August and the third consecutive month of rises.
Respondents were more confident about their current financial situation and the wider economy, as well as being more optimistic about the coming year.
Both the forward-looking personal financial situation and general economic situation sub-indices rose by one point each, to 5 and -22 respectively.
However, the major purchase index dipped one point to -8, while the savings index was up 5 at 27. The savings index is not used to calculate the overall consumer confidence barometer but provides a measure of household’s spending intentions.
Neil Bellamy, consumer insights director at GfK said: “September continued the gradual recovery seen since April.
“However, the return of higher inflation removes one of the strongest positives seen in previous months. So, while the headline score continues to improve, confidence is still firmly in negative territory. With inflation, energy and fuel prices rising, could we soon see consumer sentiment falter?”
The outbreak of war in the Middle East earlier this year has thrown global energy markets into turmoil and reignited inflationary pressures. The consumer price index reached 3.1% in April, and while the Bank of England last week left interest rates on hold, the Monetary Policy Committee warned that the cost of borrowing may yet rise should inflation worsen.
Meanwhile new chancellor John Healey is scheduled to deliver his first Budget at the end of October, and will need to balance soaring government debt and spending with sluggish economic growth and rising consumer costs, including mounting energy bills.