Confidence in big ticket item purchases drops

Consumer confidence in making large ticket item purchases dropped significantly in February, but is still appreciably higher than a year ago.

GfK’s Consumer Confidence Index saw the score drop from -20 in January to -25 In February. Consumers are asked ‘In view of the general economic situation, do you think now is the right time for people to make major purchases such as furniture or electrical goods?’

Despite the decline, the score is far more positive that the -37 seen in February 2023.

Consumers also old GfK – which has been tracking consumer confidence for 50 years – that they were neutral in their personal finance situation over the next 12 months (the same as January); and more pessimistic about the general economic situation over the next year – -24, compared with -21 in January. Both results are large improvements on consumers’ views a year ago (-18 and -43 respectively).

‘The improvement in the Overall Index Score seen over recent months stalled slightly in February due to a fall across most measures. However, the good news is that optimism for our personal financial situation for the next 12 months has not slipped back. Although registering again at zero, this is a significant improvement on the -18 score from February last year. This metric is key to understanding the financial mood of the nation because confident householders are more likely to spend despite the cost-of-living crisis,’ says Joe Staton, GfK client strategy director.

‘All the measures this February are better than a year ago, but consumer confidence alone will not carry us into a brighter economic future.’

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