Consumer confidence nears pre-crisis levels
Consumers' confidence strengthened in May and is now close to pre-financial crisis levels, according to a report.
With the general election now out of the way, people's economic optimism has reached the strongest level recorded since May 2014, the research compiled by YouGov and the Centre for Economics and Business Research (Cebr) found.
The confidence index reached 115.1 in May, marking an increase of 1.5 points on April and the highest reading since May 2014. It is also the second highest reading since April 2007, the report said.
Stephen Harmston, head of YouGov reports, said: "With the election now over, consumer confidence has strengthened and is now close to where it was before the financial crisis ... people are now increasingly optimistic about what will happen over the next year."
One in eight (12%) people said their household financial situations have improved in the last month, marking the highest percentage since this question started to be asked in February 2009.
Meanwhile, one in six (16%) of people said their household finances had worsened over the last month, which was the lowest percentage ever recorded by the survey.
For the second month in a row, more people expect their household financial situations to improve in the coming year than those who predict a deterioration.
More than one in four (26%) people expect to see an improvement in the year ahead - marking the most upbeat findings since March 2010. Just under one in four (24%) think their situation will deteriorate.
The YouGov/Cebr consumer confidence index asks up to 7,000 people a month about their financial situation.
The latest report adds to a string of studies suggesting the squeeze on household budgets is continuing to ease. A separate report released by Asda has found that families had an extra £17 a week in their pockets to spend on treats in April compared with a year earlier.
Office for National Statistics (ONS) figures recently showed that inflation turned negative for the first time in more than half a century last month.
Chancellor George Osborne previously hailed the ONS figures as "good news for family budgets". The Consumer Price Index (CPI) measure of inflation dipped to minus 0.1%, the ONS said.
Scott Corfe, associate director at Cebr, said the improvement in economic confidence comes against a backdrop of improving employment figures, "good" deflation and increasing wages.
He continued: "However, it is clear that the economy still faces some notable problems - particularly the lack of business investment, a preponderance of low-paid, part-time jobs and large regional variations in growth."
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