Consumer confidence on the up

1 September 2010

Consumer confidence climbed in August for the first time in six months, new figures have revealed.

This despite the looming austerity measures to be introduced by the government.

According to the GfK NOP consumer confidence index, optimism among consumers rose by four points in August to reach -18.

This was an increase of seven points on the same time last year and the first rise since February.

The index measure was based on interviews with 2,000 people.

The most marked improvement came in the level of confidence respondents had in the economy over the coming 12 months, up to -14 from the -25 recorded in July.

However, optimism was more muted when it came to making major purchases, a category where confidence slipped by four points to -20.

Nick Moon, managing director of GfK NOP, said: "Overall consumer confidence has been in constant decline for the last five months and a further fall would have made a double-dip recession seem a very real prospect.

"The government will undoubtedly read these figures with a great deal of relief."

But Mr Moon went on to warn against over-interpreting figures based on just one month, arguing that the index is still very low.

He added: "This gain merely reverses a large drop in July. Confidence in the economy's future prospects remains below its June level and similar to May 2009 when we were still in the grips of recession."