Consumer confidence was a little firmer in May following April’s drop to a 16-month low. But suspicion lingers that consumers will be cautious in their spending with recent rises in unemployment and glacial growth in household incomes. 

According to the GfK confidence index there was a recovery to minus one in May after sliding to minus three in April. Nevertheless, confidence in May was still at its second lowest level since December 2014.

The index has generally been on a downward trend since August 2015, when it stood at plus seven (the equal highest level with June since January 2000).

Consumer confidence has been primarily dragged down by markedly reduced perceptions of the economy’s performance over the past 12 months and the outlook for the next 12 months.

These elements both weakened appreciably further in April; and while they edged up in May, they are now well below the levels seen a year ago.

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