Consumer confidence increased in May as turbulence around April’s “Trump tariffs” calmed, but comes amid warnings that inflation could mean relief is short-lived.
GfK’s long-running consumer confidence index increased by three points but remains firmly in negative territory at minus 20.
The improvement was driven by a five-point increase in confidence in personal finances over the coming year to positive two – although still five points worse than this time last year – and a four-point boost in the outlook for the general economy to minus 16 points, worse than last May.
The major purchase index – an indicator of confidence in buying big ticket items – rose three points to minus 16, its highest level since the end of last year.
The survey was taken at the beginning of this month, well before official figures on Wednesday showed Consumer Prices Index (CPI) inflation jumped to 3.5% in April, up from 2.6% in March and the highest since January 2024, on the back of “Awful April” household bill rises.
Neil Bellamy, consumer insights director at GfK, said: “Have consumers taken comfort from the Bank of England’s May 8 quarter-point base rate cut?
“And have they breathed a tiny sigh of relief since April when the sudden turbulence of the Trump tariffs was prompting dire warnings of economic damage and a return to inflation?
“Those dangers – especially the issue of inflation – have not disappeared but the consumer mood in the UK does appear to have improved a little.”
