UK consumer confidence picks up in September but remains close to lows after Brexit vote

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Consumer confidence picked up slightly in September, but remains close to the lows hit in the wake of the June 2016 Brexit vote, according to the latest snapshot of UK sentiment.

GfK's headline index rose 1 point to -9 in the month.

It had slipped sharply to -12 in the month after the referendum as confidence was hit by the shock result.

The index rapidly recovered but has been on a broadly declining trend since September 2016.

GfK reported that there was a decline in peoples' perception of their personal financial situation over the next year.

The data conflicts somewhat with the latest Distributive Trades Survey from the CBI which earlier this weeks showed retail sales hitting a two-year high in September.

Retail sales are considered a bellwether for momentum in the wider economy, since they account for around 30 per cent of UK household consumption – which in turn accounts for around 60 per cent of GDP.

But Joe Staton of GfK emphasised the resilience of UK shoppers.

"Consumers are still spending out there, and have repeatedly defied predictions of a downturn since last year’s Brexit vote, partly by running down savings and/or borrowing more," he said.

"Indeed, the major purchase indicator has crept up a second month in a row and the savings index has sagged. It’s live now, pay later. This defiant consumer mood seems to be the ‘new normal’. But how long can it last?”

A separate index from Lloyds Bank also released on Friday showed overall business confidence rose 6 points to 23 per cent in September.

Economic optimism among firms increased by 7 points to 12 per cent, but that was still the second lowest level of 2017.