Consumer confidence in the UK witnessed the highest month-on-month rise in January 2017, according to data from YouGov and Centre for Economics and Business Research (CEBR).
The YouGov/CEBR consumer confidence index rose by 2 points in the first month of 2017 to 110.3, which is the greatest month-on-month improvement since September 2016, when it stood at 111.5.
The index is based on a survey wherein consumer confidence data is collected from each day with 6,000 interviews a month. Respondents are asked to give their views on household finances, property prices, job security and business activity – over the past 30 days and for the next 12 months.
According to the latest survey, seven of these eight measures had seen an improvement, while job security was the only measure that declined when compared to the previous month. The largest improvements were in expected house values and expected business activity over the next year, and business activity in the workplace over the last 30 days.
Overall, the latest reading was positive as a score above 100 means that there are more consumers that are confident of the economy. However, on the negative side, the index was notably lower than the levels seen before the June Brexit vote.
Commenting on the survey, Scott Corfe, director at CEBR said, "The UK economy has defied the gloomy predictions of the Treasury since the Brexit vote, and continued positive data are reflected in the latest consumer confidence figures. But there may be a sting in the tail. Inflation is picking up and the rising cost of living could start to erode consumer confidence, particularly if pay growth stays subdued."
While Stephen Harmston of YouGov noted, "Over the past month or so many economists have started to walk back from some of the gloomier forecasts of what they thought would happen in the wake of a Brexit vote. Consumers have noticed and are now assessing their economic situations with their own eyes. While the improvement in confidence is good news for the economy and reflects a resilience, when it comes to the consumer impact of Brexit we are still very much in the early stages. However, at the moment, things look good."