Signs of positivity in consumers and private sector
By Laura Enfield | 24th November 2023
Signs of positivity have appeared with consumer confidence improving in recent weeks and the UK's private sector seeing a surprise return to growth.
Shoppers are planning to "loosen their purse strings" according to a closely watched survey by research group GfK.
But it also cautioned that cost of living pressures remained an important limiting factor on household spending, reports Sky News.
Its monthly Consumer Confidence Index was still in negative territory in November, but had increased by six points to -24. Last month the index fell nine points to -30.
The firm's client strategy director Joe Staton said: "Although the overall score is still tracking firmly in negative territory, it is good to see that consumers are more optimistic about their personal financial situation.
"This shows people are thinking about their future with increased confidence and willingness to look beyond the short term.
"Despite the acute cost of living pressures, many would still like to loosen their purse strings just a little so they can enjoy that feelgood factor we all associate with the festive season."
The survey also found that confidence in the general economy over the next year had increased by six points to -26, while its "major purchase index", which measures confidence in buying big ticket items, leapt 10 points to -24.
The figures are likely to give some encouragement to retailers as they head into the crucial Christmas period.
ProCook is one of the local retailers doing well. The Gloucester-based kitchenware specialist, has just opened its 60th store in Watford.
Meanwhile the growth in the UK's private sector was reported by the S&P Global/CIPS flash UK purchasing managers' index (PMI).
It comes following three months of decline - and amid expectations from economists that the slump would continue.
S&P Global said the improvement was the result of a return to business activity expansion in the service economy - which includes hospitality firms, banks and estate agents - alongside a softer downturn in manufacturing production.
The Bank of England's decision to freeze interest rates and the recent decline in the rate of inflation also likely contributed, experts said.
Initial findings from the survey, of manufacturers and service providers, recorded a PMI score of 50.1 for November. Any figure above 50 suggests growth.
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