22nd December 2014
Consumer confidence has rocketed in the run up to the festive season according to the latest Lloyds Bank Spending Power Report.
The bank claimed the survey’s score jumped to its best level since the start of the index, climbing three points to 154.
November also saw sentiment increase 12 points towards the UK’s economic situation from last month to 295 points, representing an annual jump of 79 points.
Sentiment towards the current situation also climbed five points to 191. However, consumer confidence towards the future situation has remained static at 116, with the rate of overall improvement flattening off for the second half of the year.
For essential spend, the continued decline in petrol prices has played a part in average spending being 6% lower than this time last year, saving consumers £69 on average.
In addition, gas and electricity bills continue to fall at around 6% with a £80 saving on average. This equated to an annualised decrease in spend of almost £150 per household for gas and electricity. Slightly warmer conditions throughout the year have also helped keep gas and electricity bills low.
Patrick Foley, chief economist at Lloyds Bank, said: “Falling fuel prices and reduced consumption of gas and electricity are now adding up to a noticeable reduction in the cost of essential spending. Together with job security continuing to improve, particularly for those who say that money is tight, this bodes well for an improvement in households’ disposable incomes and a continuation of 2014’s robust economic growth in 2015.”
Consumer sentiment towards the country’s financial situation improved six percentage points in November with the balance of opinion at -30%, up 23 percentage points from this time last year, although still negative overall. Greater London continues to be the most positive region and increases seven percentage points to -2%. However, the gap between the other regions widens with the closest region, East Midlands 20 points behind at -22%.
Feelings towards the housing market have increased to -10%, up five percentage points from this time last year and four percentage points from this time last month. There is a notable increase of opinion across the East Midlands to 4% from -9% in October and Greater London at 3% from -10% in October. South West has seen the biggest increase this month, up 17 percentage points since last month to -4%. Northern Ireland is now the most negative at -34%, down 13 percentage points from last month.
Attitude towards the current employment situation has remained broadly stable since August at -18%, however, there is still a 32 percentage point increase compared to November 2013. Greater London has returned to a positive balance this month, increasing six percentage points to 6%. After being the lowest scoring region last month at -44%, Yorkshire and Humberside have seen the biggest improvement of 18 percentage points to -26%.
Consumers’ sentiment about their own personal financial situation is at its highest level since the start of the survey in 2011, with an eight percentage point improvement from last month at 21% and a 14 percentage point increase from this time last year.
Greater London has seen a notable 23 percentage point increase from last month, making it the most positive region at 36%. Scotland currently holds the lowest opinion towards their personal finances at 8%, down 10 percentage points from last month.