GfK NOP Consumer Confidence - October 2009

UK consumers’ confidence continues to grow.

 

• The GfK NOP Consumer Confidence Index rose by three points in October, to -13; the highest score since January 2008. 
• Confidence in "general economy over the last 12 months” jumped a huge ten points, but is still low, at -53. However, this is the highest it has been since April 2008.
• Confidence in the "general economy over the next 12 months” showed the only drop – falling one point to +3, but still in positive territory for only the second time since Jun 1999.
• The ‘major purchase Index’, has risen three points to -12, the highest this has been since November 2007.

Rachael Joy in the Consumer Confidence team at GfK NOP commented,

"Consumer Confidence in the UK improved for the second month running to -13, a level that we have not seen since January 2008. While this is still in negative territory, we have now not seen a drop in the monthly confidence rating throughout 2009 – indicating a steady, if cautious, uplift in British confidence in our economic situation. Only 1 out of the 4 measures that make up our Index figure showed a drop, and that was a one-point drop in our confidence in the general economy over the next 12 months, suggesting that consumers are still wary of the future and so the overall trend towards uplift is still fragile.

Joy continues, "While the measures for personal finances both showed uplift of one point each, the measure that showed a major jump was our confidence in the general UK economy over the last 12 months. This shot up by 10 points – but nevertheless remains very low at minus fifty-three. Together with the other readings, we believe this indicates a possible adjustment in UK attitude towards the new ‘age of austerity’, where people are becoming more comfortable with living with restricted spending.”

UK Consumer Confidence Measures – October 2009

The overall index score this month improved again by three points and is now at a score of -13, twenty-three points better than this time last year. Four of the five measures this month experienced a marked improvement. The annual moving average also improved and is now, -28.

	October 2009	September 2009	October 2008
Overall index score	-13	-16	-36
Personal financial situation over last 12 months	-12	-13	-18
Personal financial situation over next 12 months	+6	+5	-12
General economic situation over last 12 months	-53	-63	-72
General economic situation over next 12 months	+3	+4	-37
Climate for major purchases	-12	-15	-43

Personal Financial Situation

The index measuring changes in personal finances during the last twelve months has improved by one point to a score of -12; this is six points higher than this time last year.

The forecast for personal finances over the next twelve months increased one point to a score of +6. This is eighteen points higher than October ’08.

General Economic Situation

The measure for the general economic situation of the country during the last twelve months has risen by ten points to –53; nineteen points higher than this time last year.

In expectation for the general economic situation over the next twelve months dropped by one point to a score of +3; forty points higher than October ’08.

Climate for Major Purchases

The major purchases measure has risen by three points to -12; thirty-one ponts higher than this time last year.

Savings Index

The ‘now is a good time to save’ Index, has dropped one point to -6, fifteen points lower than in October ’08.

About the GfK NOP Consumer Confidence survey

Any published material requires a reference to both GfK NOP and the European Commission e.g. ‘Research carried out by GfK NOP on behalf of the European Commission’.

• The UK Consumer Confidence Survey from GfK NOP was conducted amongst a sample of 1,999 individuals aged 16+ on behalf of the European Commission. Interviewing was carried out 2 – 11 October 2009.
• Quotas are imposed on age, sex, region and social class to ensure the final sample is representative of the UK population.
• The figures contained within the Consumer Confidence Barometer have an estimated margin of error of +/-2%
• Results for the Consumer Confidence Barometer are available on the last working day of each month at 00.01am the next release is Monday 30 November 2009.
• This study has been running since 1974. Back data is available from 1996. 

The table below provides an overview of the questions asked to obtain the individual index measures:   

 

Personal financial Situation   (Q1/Q2)	This index is based on the following questions to consumers: How has the financial situation of your household changed over the last 12 months?’   Q2 ‘How do you expect the financial position of your household to change over the next 12 months?’   (a lot better –  a little better – stay(ed) the same –a little worse - a lot worse)
General Economic Situation   (Q3/Q4)	This index is based on the following questions to consumers: ‘How do you think the general economic situation in this country has changed over the last 12 months?’   ‘How do you expect the general economic situation in this country to develop over the next 12 months?’   (a lot better –  a little better – stay(ed) the same – a little worse - a lot worse)
Climate for major purchases   (Q8)	This index is based on the following question to consumers: ‘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?   (right time – neither right nor wrong time – wrong time)
Savings   Index   (Q10)	This Savings index is based on the following question to consumers: ‘In view of the general economic situation do you think now is:?”   (a very good time to save – a fairly good time to save – not a good time to save – a very bad time to save)   (Commented on but not included in the Index score)