UK consumer confidence ticks up in ‘sigh of relief’ after Truss

UK consumer confidence ticked higher for a second month after Prime Minister Rishi Sunak worked to stabilise the economy following the disastrous and short tenure of his predecessor, Liz Truss.

The market research firm GfK said its measure of sentiment rose three points to minus 44 in November, leaving it near the record low of minus 49 recorded in September when Truss’s plan to slash taxes triggered panic in financial markets.

“This month’s fillip is likely to reflect nothing more than a collective sigh of relief as a new prime minister takes charge following the alarming fiscal antics we saw in September,” said Joe Staton, client strategy director at GfK. “External factors have changed little. More bad news is inevitable.”

Confidence is well below levels of a year ago, reflecting a jump in food and energy prices that’s squeezing living standards and driving the economy into recession. GfK said consumers remain under pressure from rising interest rates, taxes and rent payments.

GfK’s report provides a glimmer of hope for retailers and hospitality companies looking for a boost in spending around the Christmas and New Year holidays. Economists expect the government to report the first increase in retail sales in three months when data for October are published at 7.00 am in London on Friday (Nov 18).

“Retail and leisure businesses will be hoping for a feel-good factor that at least temporarily boosts spending, despite the increasing difficulty, or reluctance, of some consumers to spend,” said Linda Ellett, UK head of consumer markets, retail and leisure at the consultant KPMG UK. BLOOMBERG

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