British consumer confidence rises

Nationwide’s consumer confidence index rose two points in February from 41 to 43, its first rise since October 2008, despite worsening economic conditions over the month.

Confidence rose because of a slight increase in optimism about future economic and labour market conditions, according to the building society.

Of the 1,000 consumers surveyed, 19% thought conditions would be better in six months, against 17% in January. However, 43% thought they would be worse.

On employment, 65% thought there would be few jobs available in six months, compared with 18% who thought there would be “many” or “some”. A majority, 65%, thought household income would be the same in six months.

Confidence in the present situation dropped to 22, its eighth consecutive fall. Some 86% of consumers in February still described the current economic situation as “bad” and 64% said there were few jobs available.

However, sentiment about spending rose to 92 from 85 after remaining steady through December and January. In February 38% of consumers believed it was a good time to make a major purchase, such as a house or car.

Fionnuala Earley, the chief economist at Nationwide, said in a statement, “Spending confidence continues to be resilient, which could reflect the effect of sharp falls in interest rates on consumers’ disposable incomes, but is also likely to reflect significant discounts available.”

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