Consumer confidence in the UK experienced a boost in December, with a two-point increase in GfK’s Consumer Confidence Index. This follows a six-point growth in November, resulting in a year-on-year rise of 20 points throughout 2022. However, it is essential to remember that the overall reading still remains in negative territory.

Joe Staton, Client Strategy Director at GfK, emphasized the significance of the recovery in the personal finance measure, which reflects optimism and control over household finances. While the cost-of-living crisis continues to impact households, the gradual movement towards positive territory in personal finance is an encouraging sign for the upcoming year.

Alongside the rise in consumer confidence, other key indicators also witnessed improvements. The nation’s current Personal Financial Situation increased by two points to -14, demonstrating a significant improvement compared to the previous year. The Forecast for Personal Finances over the next 12 months also saw a one-point increase to -2, signifying a 27-point improvement from the same period in the previous year.

The General Economic Situation in the country over the last 12 months experienced a five-point growth from November’s reading, reaching -44. This represents a 22-point increase from December 2022. Similarly, expectations for the General Economic Situation over the next 12 months rose by one point to -25, showcasing a notable improvement of 28 points compared to the previous year.

The Major Purchase Index, which measures consumer confidence in making significant purchases, also experienced a one-point improvement to -23. This stands 11 points higher than the same month in the previous year. The Savings Index also witnessed a two-point increase to +27, indicating a seven-point improvement compared to last year.

Overall, while consumer confidence in the UK still remains in negative territory, the December data suggests a potentially optimistic outlook for consumers in 2024. The improvements in personal finance measures, as well as the general economic situation and major purchase intentions, provide hope for a more positive year ahead. However, it is crucial to exercise caution considering the ongoing challenges posed by the cost-of-living crisis.

Useful Links:
1. GfK UK Consumer Confidence Index
2. Office for National Statistics