UK consumer confidence jumps to two-year high, GfK says

British consumer morale reached a two-year high in August, according to a survey released by GfK on Friday. This positive trend comes as households become more confident about making significant purchases, contributing to a series of unexpectedly strong economic indicators. The GfK Consumer Confidence Index increased to -14 from -17 in July, surpassing expectations in a Reuters poll of economists who had predicted a drop to -18.

Despite inflation rising again and ongoing uncertainty in the Middle East and other regions, Neil Bellamy, GfK's consumer insights director, noted that UK consumers still face various challenges that will test their resilience. Of the five key sub-indexes in the survey, all but one saw an increase in August, with confidence for making major purchases reaching its highest level since December 2021.

Personal financial confidence for the next 12 months also hit its highest point since January, while economic expectations rose to a two-year peak. Multiple other consumer confidence surveys, including YouGov/Cebr, BRC-Opinium, Barclays, and LSEG/Ipsos, have also reported upticks in the past month. GfK's survey, which has been conducted since 1974, polled 2,000 adults between July 30 and August 12.