U.K. Consumer Confidence Posts Biggest Jump in Year in January

U.K. consumer confidence jumped the most in a year in January as oil prices plunged, providing a boost for Prime Minister David Cameron as he seeks re-election in May.

A consumer sentiment index by GfK NOP Ltd. rose 5 points from December to 1, its biggest monthly increase in a year, the London-based group said in a report published today. That took the index back to its August level, the highest since 2005.

With polls suggesting the May 7 election remains too close to call, Cameron is highlighting the Conservatives’ stewardship of the economy to gain the votes needed to secure a parliamentary majority.

Consumers powered Britain to its strongest growth since 2007 last year as exporters struggled amid stagnation in the euro area. An oil-driven fall in inflation, rising wages and the prospect of interest rates staying at record lows this year could see the economy expand at a similar pace in 2015, according to forecasters including the International Monetary Fund.

“With less than 100 days before the election, this big jump in the index will be very welcome news for the government,” said Nick Moon, Managing Director of Social Research at GfK.

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