U.K. consumer confidence held steady this month as households adjusted to a “new normal” amid accelerating inflation and a sluggish economic recovery.
A sentiment index by GfK NOP Ltd. stayed at minus 26, the London-based group said in a report today. Economists had forecast a decline to minus 27, according to the median of 19 estimates in a Bloomberg News survey. Still, measures of the outlook for the economy and personal finances both declined.
While an unchanged reading “may not seem like cause for rejoicing, it does now begin to seem that the public’s mood has climbed slightly out of the very deep trough it was in for almost all of 2012,” said GfK Managing Director Nick Moon. “What we are seeing now looks more like the new normal than a temporary boost.”
Higher energy bills and inflation that’s outpacing wage growth may restrict further gains in sentiment. Data yesterday showed Britons’ disposable income fell 0.1 percent in the fourth quarter, while clothing retailer Next Plc said on March 21 that the coming year is likely to be “challenging.”
A measure of Britons’ outlook for the economy over the next 12 months fell 2 points to minus 27 this month, while their view of the past year also declined, GfK said. Consumers’ expectations for their personal finances slipped 1 point to minus 6. The gauge of the climate for making major purchases rose 3 points to minus 23.
GfK interviewed 2,000 people from March 1 to March 10.