U.K. consumer confidence unexpectedly increased to an 18-month high in November as Britons become more optimistic about the economy and their finances, GfK NOP Ltd. said.
A sentiment index rose to minus 22, the strongest reading since May 2011, from minus 30 in October, the London-based research group said in an e-mailed report today. Economists had forecast that the index would remain unchanged, according to the median of 23 estimates in a Bloomberg News survey.
The surprise jump in sentiment contrasts with the Bank of England’s downbeat assessment of the economy earlier this month and Governor Mervyn King’s acknowledgment that its previous forecasts were too optimistic. GfK said its gauges of consumers’ expectations for the economy and personal finances both increased this month.
The increase “could be because consumers now think things can’t get any worse or it may be for more positive reasons, but either way it is good news,” said Nick Moon, managing director of social research at GfK. “The direction things head in the New Year will be crucial in determining whether this is a short- term spike or the start of a long-term improvement in people’s spending habits.”
A measure of Britons’ outlook for the economy over the next 12 months jumped 14 points to minus 15, while the outlook for their personal finances rose 6 points to minus 7. The climate for making major purchases increased 7 points to minus 26. GfK interviewed 2,001 people between Nov. 2 and Nov. 11.
Britain exited recession in the third quarter with the strongest growth in five years as the Olympics gave a boost to stores, hotels and restaurants. The Bank of England says the economy may shrink again in the current quarter as temporary factors create a “zig zag” effect on gross domestic product.
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