Consumer confidence increases in May

The results in the May index showed a one-point rise in people’s perceptions of their own personal financial situation over the past year, hitting a total score of -10 and 10 points better off than May 2023.

The forecast for personal finances over the next 12 months jumped up five points to a positive score of seven, which was 15 points above the same month last year.

For the general economic situation, there was a two-point increase in perceptions of the economy’s performance over the past year, albeit to a negative score of -39. This was 15 points up from a year ago.

For the year ahead, expectations for the economy were at -17, a four-point rise on the previous month and 13 points higher than May 2023.

The savings index, which measures whether now is a good time to save money, has increased one point to 27 in May, which was also eight points higher than this time last year.

However, the major purchase index, which covers whether the time is right for a major purchase, was down one point to -26 and two points lower than this month last year.

The results are based on a nationally representative survey of 2,009 UK adults carried out between 1st and 5th May, prior to the Prime Minister’s decision on 22nd May to call a general election for 4th July.

Joe Staton, client strategy director at GfK, said: “The only negative in May is the slight dip in our major purchase measure (down one point to -26 ), reinforcing the fact that the cost-of-living crisis is still a day-to-day reality for all of us.

“However, with the latest drop in headline inflation and the prospect of interest rate cuts in due course, the trend is certainly positive after a long period of stasis which has seen the overall index score stuck in the doldrums. All in all, consumers are clearly sensing that conditions are improving. This good result anticipates further growth in confidence in the months to come.”