Data: Consumer confidence edges ahead of pre-pandemic levels

Sentiment rose by two points from -9 in June to reach -7 in July. This was the highest level of consumer confidence recorded since pre-lockdown in March 2020, according to GfK’s Consumer Confidence Index. 

It also marked six months since a fall in consumer confidence levels. 

Consumers remained generally positive about their personal finances over the next 12 months, although confidence in the general economic situation for next year dropped by three points as uncertainty around inflation and the Delta variant looms.

This remains 36 points higher than what the index recorded in July 2020.

The major purchase index increased by 7 points in July, while consumers indicated that they still felt now was a good time to save. 

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.”

“However, threats from increasing consumer price inflation, Covid variants and rising infection figures, and the looming end of furlough and the Job Retention Scheme could put the brakes on this rebound. 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. 

“What happens across the remaining summer months will frame consumer confidence for the rest of 2021 and beyond.”