Photographer: Suzanne Plunkett/Bloomberg

British Consumers Are Almost Feeling Better

  • Confidence index rises, yet remains below pre-Brexit levels
  • Job security and business activity outlook measures slide

U.K. consumer confidence is slowly recovering from a dip after the Brexit referendum, buoyed by a positive outlook for property prices and household finances.

An index of sentiment by YouGov and the Centre for Economics and Business Research rose for a second month in September. The gauge, based on 6,000 interviews, remains below the level it was before Britain’s vote to leave the European Union.

While confidence increased overall, underlying measures were mixed, with job security over the next 12 months sliding to the lowest since February. That was balanced by improved house values and business activity over the past month, as well as a notable strengthening in consumers’ outlook for their finances and home values in the year ahead.

“Though the economy is showing few -- if any -- signs of a Brexit-induced slowdown, consumers have not quite regained their pre-referendum confidence,” said Scott Corfe, director at the CEBR. “There are fears about the longer-term impact of the vote.”

Initial concern after the June 23 referendum has been tempered by better-than-expected data that sent Citigroup’s index of economic surprises to the most positive level in three years last month. But, for now, officials have yet to formally begin the process of negotiating the U.K.’s exit from the trading bloc, which YouGov says may damp sentiment.

“The business activity and job security figures for the coming 12 months imply that consumers are starting to factor in Article 50 being triggered in the next year,” said Stephen Harmston, head of reports at YouGov. “This suggests that the referendum’s impact on the economy has been deferred for the time being rather than averted entirely.”

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