In March, UK consumer confidence increased marginally by one point to -19 according to the GfK index, surpassing expectations of a decline to -21. Despite this slight improvement, experts caution that economic conditions remain challenging, with households exhibiting caution due to ongoing pressures. The sentiment index's rise was driven by better perceptions of past economic performance and cautious optimism for the future. However, recent GDP data showing a contraction further tempers hopes for recovery, with the index still significantly below the long-term average, raising concerns about sustained consumer behavior going forward.
Consumer confidence remains subdued... If [it] were a patient languishing in a hospital bed, a doctor would say there is little evidence of a recovery as yet.
While the figure beat analysts' expectations of a fall to -21, experts warned there is still 'little evidence of a recovery' as households remain cautious in the face of persistent economic pressures.
Despite wage growth outpacing inflation for the past 18 months, March saw a slight dip in personal finance expectations for the year ahead.
Although the consumer confidence index has recovered somewhat from its record lows during the peak of the cost of living crisis in late 2022, it remains well below the long-term average of -10.
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