GfK barometer rises to -13 but major purchases fall

UK consumer confidence rose to its highest level in two years in September, according to research group GfK, though Bloomberg suggested the recovery may be running out of steam as higher energy costs push up inflation.

GfK reported its Consumer Confidence Barometer reached -13 in September, a one-point increase compared with August and the highest reading since August 2024, just after the last general election. The figure surpassed analysts’ forecasts. The index has now risen for three consecutive months for the first time since summer 2024.

The improvement follows what UK businesses have described as a “Burnham bounce” after the new prime minister took the wheel from Sir Keir Starmer and announced measures including a cap on bus fares and a discount on business rates for pubs, clubs and live music venues.

Bloomberg suggested that GfK’s data shows the recovery is running out of steam as higher energy costs push up inflation.

GfK reported that consumers are less willing to buy big-ticket items this month and more keen to save money instead. The Major Purchase Index fell one point — the only measure in the barometer to decline this month. The Savings Index rose five points; GfK noted that the Savings Index, although not used in its headline score, “may indicate that those who can are thinking of building a financial buffer.”

Neil Bellamy, GfK’s consumer insights director, said inflation posed a threat to the recovery. “The return of higher inflation removes one of the strongest positives seen in previous months,” Bellamy said. “So, while the headline score continues to improve, confidence is still firmly in negative territory. With inflation, energy and fuel prices rising, could we soon see consumer sentiment falter?”

Bellamy added that the only measure to fall was the Major Purchase Index, down one point, “which comes as we head into the important Golden Quarter for retailers.” He noted that the Savings Index’s five-point rise, “although not used in our headline score,” “may indicate that those who can are thinking of building a financial buffer.”

Also on the calendar

The Guardian’s live coverage flagged three items scheduled for later on Friday:

  • 10.15am BST: Bank of England governor Andrew Bailey on the Monetary Economics Conference panel.
  • 1.30pm BST: US durable goods orders data.
  • 3pm BST: University of Michigan’s US consumer sentiment index.