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Deloitte study shows record rise in consumer confidence in Q1

May 07
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Signs of progress in the UK's journey out of the pandemic-enforced lockdown fuelled a record increase in consumer confidence during the first quarter of 2021, according to research by Deloitte.

The company's latest Consumer Tracker showed that public confidence grew by six percentage points in the first three months of the year. However, it remained in negative territory at -11 per cent.

Every gauge of consumer sentiment improved on both a year-on-year and quarter-on-quarter basis. 

Deloitte's measure of attitudes about the state of the economy increased by 12 percentage points compared to the fourth quarter of 2020, as people took confidence from the gradual easing of lockdown measures.

The rapid rollout of the UK's vaccination programme contributed to a more positive outlook on health and wellbeing, which gained eight percentage points to reach -26 per cent.

In an encouraging sign for businesses, Ian Stewart, chief economist at Deloitte, said the UK is "primed for a sharp snap back in consumer activity".

He added: "High levels of saving, the successful vaccination rollout and the easing of the lockdown set the stage for a surge in spending over the coming months."

Other findings suggested people are feeling increasingly positive about job security, with attitudes on this subject improving by six percentage points in the latest survey. Furthermore, there was an increase of seven percentage points in levels of optimism about career opportunities and progression.

Mr Stewart pointed out that the eventual peak in unemployment is expected to be "far lower" than was once feared, and less severe than that caused by any economic downturn in the last 30 years.

However, he also stressed the importance of businesses being aware of potential obstacles in the country's roadmap out of lockdown.

"The risk to this upbeat outlook is the emergence of new, vaccine-resistant variants and a third wave of cases," Mr Stewart said. "With global case rates rising we're not completely out of the woods."

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