Interest rate cuts and UK-US trade agreement boost consumer confidence index in the UK
A recent survey shows that consumer confidence in the UK rebounded slightly in May due to the Bank of England lowering borrowing costs and the government reaching a trade agreement with the United States. The report released by market research firm GfK on Friday indicated that its consumer confidence index rose to -20, an increase of 3 percentage points from April, and better than economists' expectations of -22. In April, U.S. President Donald Trump escalated the trade war, raising public concerns about the economic outlook. The survey indicated that a series of positive dynamics, including robust wage growth, declining interest rates, and the anticipated alleviation of U.S. tariff impacts from the UK-U.S. trade agreement, offset the worries about the economic recession that erupted last month and anxiety over rising bills. Neil Bellamy, GfK's Director of Consumer Insights, stated, "These risks, particularly the inflation issue, have not disappeared, but consumer sentiment in the UK has indeed improved slightly." The warming confidence may be driving consumer spending. GfK's measure of purchase intentions for big-ticket items such as cars and furniture has risen to its highest level since the end of 2024
According to the Zhitong Finance APP, a recent survey shows that UK consumer confidence rebounded slightly in May due to the Bank of England lowering borrowing costs and the government reaching a trade agreement with the United States. The market research firm GfK released a report on Friday indicating that its consumer confidence index rose to -20, an increase of 3 percentage points from April, and better than economists' expectations of -22. In April, U.S. President Donald Trump escalated the trade war, raising public concerns about the economic outlook.
The survey indicates that a series of positive dynamics, including robust wage growth, declining interest rates, and the anticipated alleviation of U.S. tariff impacts due to the UK-U.S. trade agreement, have offset the concerns about the economic recession that erupted last month and the anxiety over rising bills.
Neil Bellamy, GfK's Director of Consumer Insights, stated: "These risks, especially the inflation issue, have not disappeared, but there has indeed been a slight improvement in UK consumer sentiment."
The warming confidence may be driving consumer spending. GfK's indicator measuring the intention for large purchases such as cars and furniture has risen to its highest level since the end of 2024
