Despite gloomy predictions, most consumers have yet to feel much tangible impact from the vote to leave the EU
It is clear that any panic which gripped the public in the immediate aftermath of the referendum has subsided. Two months after the UK voted to leave the European Union, the YouGov/Cebr Consumer Confidence Index has rebounded strongly in August by showing its largest monthly increase since February 2013.
The new figures show that consumer confidence has improved to 109.8 in August, up by 3.2 points from 106.6 in July. This is the highest monthly bounce seen since February 2013 when it rose by 3.5 points after the UK economy performed more strongly than expected. August’s rise in consumer confidence follows a sharp fall in July in the month following the EU vote.
YouGov collects consumer confidence data each day with 6,000 interviews a month. Respondents are asked about their household financial situations, property prices, job security and business activity in the workplace, both looking back over the past 30 days and ahead to the next 12 months.
This month’s improvement in consumer confidence follows positive news from other areas of the economy and punctures the arguments of those who predicted immediate economic Armageddon following a Brexit vote. Both inflation and unemployment are low, for now, which is undoubtedly supporting consumer optimism.
Analysis of YouGov’s data shows that the areas with the biggest increases in August are those looking ahead to the next 12 months, particularly in expected household financial situation, property prices, and levels of business activity at work. Only one has fallen slightly in the last month – job security in the year ahead.
All four measures looking back over the past 30 days have improved – household financial situation, property value, job security and business activity in the workplace.
With consumer confidence rising and year-on-year retail sales up it is evident that the public have yet to feel many – if any – effects from the vote to leave the EU. Yet despite the strong improvement during the past month the Index has only recovered around half of the ground it lost in the wake of the referendum. And, of course, everything could change once details of the deal to leave the EU emerge and the process of extracting ourselves from the Union becomes a reality.
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