Consumer confidence improved slightly in the first quarter of 2018 but people's perceptions remain negative overall, a report has found.
The Deloitte Consumer Tracker said overall consumer confidence improved to reach a reading of minus 6% in the first quarter of 2018, up one percentage point from a reading of minus 7% in the final quarter of 2017.
The report said that, behind the overall index reading, people are feeling more upbeat about their disposable income and levels of debt as well as their health and well-being, although confidence in job security has deteriorated.
The report said overall consumer confidence is now at its best levels since the fourth quarter of 2016.
It said while confidence remains in negative territory, the latest findings are a positive step from a score of minus 10% in the second quarter of 2017 which was a low point for consumer confidence in recent years.
The quarterly survey of more than 3,000 people across the UK was carried out between March 23 and 26.
Ian Stewart, chief economist at Deloitte, said: "Confidence has crept up against a backdrop of consumer-friendly economic conditions.
"Unemployment has hit a 43-year low and is stoking wage pressures while falling inflation will boost consumer spending power and has eased the pressure for rate rises.
"The consumer picture mirrors that of the business landscape, with chief financial officers also reporting an uptick in confidence following the announcement of the Brexit transition deal.
"It remains to be seen to what extent consumers will continue to exercise caution in 2018, and not-too-distant memories of tougher times could yet outweigh consumers' willingness to spend."
The report also said people are continuing to prioritise spending on essential categories such as utility bills, transport and food and drink rather than discretionary spending, including going out, furniture and electrical appliances.
People who spent less on going out in quarter one 2018 tended to say they did so because they could not afford it, the report found.
Ben Perkins, head of consumer business research at Deloitte, said: "Looking ahead, quarter two confidence may improve further with the belated arrival of warmer weather and optimism ahead of the World Cup which is an event that has historically provided a boost to consumer spending across a range of categories, especially if the national team progresses to the later stages of the competition."