UK Consumer Confidence Hits Two-Year High Amid Ongoing Inflation Risks

UK consumer confidence has reached its highest level in two years, according to the latest GfK Consumer Confidence Barometer. The index rose to -13 in September from -14 in August, beating economists' forecasts of a decline to -16. This improvement in sentiment is particularly notable given the ongoing inflation risks and energy price pressures facing households.

GfK's survey also showed that confidence in personal finances has reached an eight-month high, while optimism about the economic outlook has not been this strong since August 2024. However, Neil Bellamy, consumer insights director at GfK, cautioned that rising inflation, energy, and fuel prices could yet cause sentiment to weaken.

Other sentiment indicators published in September also point to firmer confidence among households, although the broader picture for consumer demand remains uneven. While some surveys show a decline in consumer confidence, others highlight continued resilience in the UK economy.