UK consumer confidence climbs to two-year high: GfK survey

BRITISH consumers are more confident than at any point since Labour took power two years ago, further evidence that the national mood has improved since Andy Burnham took over as prime minister in July.

GfK said its indicator tracking overall consumer sentiment rose three percentage points to minus 14 in August. The index has surged 9 points over the past two months to levels last seen in August 2024, shortly after Keir Starmer led the Labour Party to a landslide election win.

Starmer entered Downing Street with strong public backing, but tax rises, policy U-turns and global turbulence took a heavy toll on confidence and eventually cost him his job.

His successor is now enjoying what’s being called the “Burnham bounce” in opinion polls after announcing a slew measures to help with the cost of living and promising to devolve power from London to England’s regions. 

GfK’s survey chimes with figures from the British Retail Consortium showing sentiment rebounding strongly in August. Neil Bellamy, consumer insights director at GfK, said it’s “too soon to tell” if the improvement will translate into a long-term recovery in spending.

Consumers, who drive about 60 per cent of economic output, still face a difficult jobs picture, rising inflation and uncertainty over the Middle East conflict.

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“There are still many challenges ahead that will test the mettle of UK consumers,” Bellamy said.

All the sentiment indicators tracked by GfK improved in August. Households’ views of their personal finances climbed further into positive territory, with intentions to make major purchases at their highest since 2021. Britons have also turned more optimistic about the economy as a whole. BLOOMBERG