UK consumer confidence climbs to five-year high

Though London shoppers aren't feeling so bullish...

UK consumer confidence climbs to five-year high

Picture by Yui Mok PA Wire/Press Association Images

The confidence of British consumers reached a five-year high last month, according to new data from consultancy firm Deloitte.

Confidence was up 3% from the previous quarter, with the largest such increase in 18 months bringing it to its highest level since 2011.

Following the UK's June referendum on European Union membership, consumer spending overall remained largely stable, supported by low inflation.

Net spending on essentials was flat again and expenditure continued to move away from essentials and towards discretionary categories.

In addition, leisure spending continued to catch up with retail spending as consumers favoured holidays and experiences over consumer goods.

Conversely, London shoppers are actually feeling less upbeat and assured. In the English capital, where a majority voted to remain in the EU, consumer sentiment fell by 3%.

Ian Stewart, Deloitte's chief economist, said:

"The Brexit vote may be weighing on a region in which 60% of the population voted to remain and where reliance on financial services, migration and capital flows are especially strong."

The survey of over 3,000 people was conducted in mid-September – before last week's pricing dispute between Unilever and Tesco threatened to reduce the supplies of some of Britain's most beloved products on shelves and hinted that Brexit and a weakening pound could create further retail problems in the months and, indeed, years to come. 

Deloitte itself has warned that consumer spending could slow down in 2017.