British Consumer Morale Reaches Four-Month High in December

(Reuters) – British consumer morale hit a four-month high in December as households grew cheerier about their finances, a survey showed on Friday. This positive news arrives for finance minister Rachel Reeves, amid other indicators reflecting a post-budget slide in business sentiment.

The monthly consumer confidence index from market research firm GfK rose to -17 in December from -18 in November, marking the highest reading since August. A Reuters poll of economists had anticipated this figure to remain unchanged.

GfK’s measures of past and future financial confidence also reached four-month highs, while the other components, namely economic confidence and major purchase intentions, remained steady.

Overall, these readings suggest that consumers are still relatively confident about the outlook, contrasting with the sharp dip in business confidence following Reeves’ budget on October 30, which introduced significant tax increases for employers.

A separate YouGov/Cebr survey published on Wednesday indicated a rise in consumer confidence this month, even amid a decline in perceived job security.

Neil Bellamy, consumer insights director at NIQ GfK, noted that while consumers exhibit optimism regarding their finances, they remain uncertain about making major purchases. He emphasized the need for robust improvements in economic perceptions before a sustained uplift in consumer sentiment can be expected.

Most forecasters predict that Reeves’ budget will provide a temporary boost to Britain’s economic growth rate next year, although recent data, including retail sales, has not met expectations. Gross domestic product data for October is anticipated at 0700 GMT.

The GfK survey involved 2,015 participants and was conducted from November 28 to December 9.