Families grow increasingly confident about UK dodging recession 

Families are increasingly confident the UK will dodge a recession this year in another sign the economy is performing better than feared than at the turn of the year, a closely watched survey out today indicates.

UK consumer confidence jumped in March for the second month in a row, albeit up to a historically low minus 36 points from minus 38 points in the previous month, according to research firm Growth from Knowledge (GfK).

The numbers add to a swelling batch of data that suggests households and businesses are weathering higher interest rates, living costs and inflation that experts warned of heading into 2023.

Just last week, the Office for Budget Responsibility ditched its recession projection and said UK GDP would shrink just 0.2 per cent this year, although its long term outlook is still pretty poor.

Yesterday, the Bank of England in its statement breaking down the reasons behind its eleventh rate rise in a row – up 25 basis points to a post-financial crisis high to 4.25 per cent – suggested it now doesn’t think the country will slide into a slow burning slump.

Back in November, governor Andrew Bailey and co reckoned Britain was on track to suffer the longest recession in a century that would shave about three per cent off of GDP.

Families and businesses are still being hobbled by the cost of living crunch, which showed up in GfK’s data.

Brits’ confidence in their personal finances over the next year trimmed three points, but every other category improved.

Joe Staton, client strategy director at GfK, said: “A small improvement in the overall index score this month masks continuing concerns among consumers about their personal financial situation.” 

“This measure best reflects the financial pulse of the nation and it remains weak, with the figure for the coming year down three to -21 and an unchanged score for the past 12 months of -26,” he added.