Is the prospect of a hung parliament scaring consumers?
Not yet awhile. Nor is there any sign that looming deflation is causing households to defer big purchases.
UK consumer confidence improved appreciably in March, according to the GfK NOP index carried out on behalf of the European Commission.
The confidence index jumped to +5.6 in March from +3.9 in February and +3.0 in January. At +5.6 in March, the index is substantially above its long-term average of -9.2.
March’s rise in confidence reflected further improvement consumers’ perceptions of the economy’s recent performance and its outlook. Consumers’ perception of their personal financial situation also improved in March, albeit by a lesser amount.
Consumers’ opinion of the climate for making major purchases rose sharply in March.
The survey also showed that consumers’ inflation expectations for the next 12 months rose for a second month running in March.
This, says Global Insight economist Howard Archer, reinforces belief that generalised deflation is highly unlikely to take hold in the UK and consumers are unlikely to delay making purchases in anticipation of falling prices