U.K. Consumers Cheered by Brexit Certainty as Confidence Climbs
U.K. consumer confidence improved for a second month in January as Britons became more optimistic about their personal financial situation and the wider economy in the wake of Boris Johnson’s election victory.
GfK said its index, which has been negative for four years, could soon return to positive territory if sentiment continues to strengthen.
The report is the latest to show what GfK called a “mini Boris bounce” after the Conservatives won a solid parliamentary majority last month, allowing them to end years of uncertainty and take Britain out of the European Union today. The Bank of England cited tentative signs of revival when it kept interest rates on hold on Thursday.
The pickup in confidence suggests a turnaround could be in store for British consumers -- a bulwark of the U.K. economy -- after 2019 proved a dismal year for retail sales. Risks remain, however, as Johnson tries to reach a trade deal with the EU in just 11 months. If negotiations fail, Britain will again be facing an economically disruptive break with the its biggest trading partner once EU once transitional arrangements end on Dec. 31.
©2020 Bloomberg L.P.