UK consumer morale edges up from five-year low as Brexit uncertainty persists

February 28, 2019

LONDON (Reuters) – British households are showing “amazing” stoicism as the country heads for Brexit, a market research company said on Thursday as its measure of consumer confidence edged up in February.

The GfK consumer confidence index rose to -13 from -14 in January. Economists taking part in a Reuters poll had expected a slight fall to -15.

January’s reading was the joint lowest since July 2013, but GfK said consumer confidence was not showing the kind of slide seen after the June 2016 Brexit referendum or at the start of the global financial crisis a decade ago.

“It is worth bearing in mind that many economic indicators – employment levels, wage growth – remain positive,” Joe Staton, GfK’s client strategy director, said.

“But it is frankly amazing that confidence is so stoic and stable in a world of sharp political instability and fear of the unknown.”

On Tuesday Prime Minister Theresa May opened up the possibility for parliament to vote to delay Britain’s departure from the European Union past a due date of March 29, if lawmakers reject her preferred exit deal.

The GfK survey showed households’ feelings about their personal finances held steady but they were more willing to make major purchases and their outlook on the economy over the next 12 months improved slightly from January’s seven-year low.

Spending by Britain’s consumers has helped the economy to withstand the strains of Brexit and the combination of slowing inflation and gradually rising wages is expected to help households in 2019, even as the overall economy weakens.

By contrast, many employers are showing signs of nervousness and business investment fell throughout 2018 according to official data.

The GfK survey was carried out on behalf of the European Commission between Feb. 1 and Feb. 14.

(Reporting by William Schomberg, editing by David Milliken)

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