'Defiant' consumers drive growing confidence on spending

Consumer "defiance" has helped confidence grow for another month as a widely predicted drop in spending fails to materialise, figures show.

The long-running GfK Consumer Confidence Index rose another point to minus nine in September on top of August's two-point increase.

The survey shows confidence in personal finances, looking back and also ahead a year, has slipped this month, but retail sales in the UK continue to grow despite non-food prices increasing at their highest rate for 25 years.

Shoppers on Oxford Street in London.
Shoppers on Oxford Street in London (PA)

The savings measure also decreased three points but remains 12 points higher than a year ago, while confidence in the general economic situation over the last year and for the next 12 months increased.

The major purchase index, a measure of confidence in spending on big ticket items, rose one point to minus one, eight points lower than this time last year.

Joe Staton, head of market dynamics at GfK, said: "Consumers appear to be in a mixed mood, with some confidence measures up and others down, yet there's a strong note of defiance.

"Many commentators expected shoppers to cut back on spending thanks to the lower purchasing power that arises from higher inflation and weak wage growth. But consumers are still spending out there, and have repeatedly defied predictions of a downturn since last year's Brexit vote, partly by running down savings and/or borrowing more.

"Indeed, the major purchase indicator has crept up a second month in a row and the savings index has sagged. It's live now, pay later."

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