2023 is for more optimistic consumers

The monthly UK Consumer Confidence Barometer (CCB) is 12 points below February 2022 (-26), but up 7 points (-38) compared to January

Latest Briefing shows the January blues have been replaced by a far more optimistic outlook towards the economy and especially inflation, with 12-month expectations that are now back to the level of July 2021.

The Feel-Good Index is up for the fifth successive month. If women’s confidence (-45) was closer to men’s (-30) the mood would be even more optimistic. An interesting matter for marketers to ponder.

JGFR Feel-Good Index January 2001- February 2023

Confidence improved in all 3 English combined regions: perhaps the Northern Irish public knew something positive may be in the air as February confidence jumped by 15 points to -31, its highest level since January 2022. At the same time confidence in the South East (-43), historically with well above average confidence, is slipping to the foot of the regional confidence table with only the North West and Scotland (-44) lower. 2023 is set to be another year of (and if economists’ predictions for 2022 are anything to go by) unexpected shifts in predicted outcomes.

Of the 5 sub-measures comprising the headline measure:

  • The financial situation of households over the past 12 months is up 5 points at -26 on the month, but down 15 points on a year ago (-11)
  • The expected financial situation of households over the next 12 months is up 9 points on the month at -18; 4 points down on 12 months ago (-14)
  • The general economic situation score over the past 12 months is 6 points higher on the month at -65, but down 15 points on 12 months ago (-50)
  • For the coming 12 months the general economic situation measure jumped 11 points to -43, unchanged vs February 2022
  • The measure of consumer sentiment to making major purchases in view of the current economic situation gained 3 points vs January to -37, 22 points below 12 months ago (-15)

Optimism returned to UK consumers in February following January’s surprise fall in confidence,buoyed by inflation expectations dropping to their lowest level since July 2021. Such a shift in inflation expectations may improve the outlook for wage settlements and interest rate rises. The economic outlook while challenging and subject to Ukraine uncertainty may be better than expected

John Gilbert, Director, JGFR

Featured image: Emma Rahmani / corelens