UK Feb consumer confidence index down 1 point to -8

UK Feb consumer confidence index down 1 point to -8 - GfK/NOP UPDATE

	Published : Wed, 28 Feb 2007 12:51 By : Agencies Print this Story

(Updates with analyst comments)

LONDON (AFX) - Consumer confidence fell slightly in February as Britons became more pessimistic about the UK's general economic situation, a leading pollster found today.

In its monthly survey, GfK/NOP said its main headline consumer confidence index fell one point to -8 from -7 in January, whereas analysts polled by AFX News were not expecting any change in the index.

Although three out of the five subindices within the indicator fell, UK consumers found some comfort in the fact that the Bank of England did not raise rates in February, said Carol Bernasconi, divisional director at GfK/NOP.

'This month consumers are much more optimistic about their personal finances compared with the past year. This is probably a result of interest rates remaining the same this month despite rumours that they would increase again,' she said.

However, past rate hikes are being felt, as 'again for the second month in a row the 'now is a good time to save index' has recorded an increase, indicating that people are being cautious in the current economic climate,' Bernasconi said.

The major purchases measure slumped 6 points to +4, while the 'now is a good time to save' index rose one point to +35.

'The current softness of consumer confidence, following news that retail sales fell back sharply in January, reinforces doubts about consumer spending's ability to sustain the robust level seen in the fourth quarter,' said Howard Archer at Global Insight.

He expects benign wage gains as well as rising interest rates and debt levels to keep consumer spending moderate over coming months.

The GfK/NOP index showed that Britons' views on the general economic situation of the country during the last 12 months have seen a drop of two points, down to -33. There was also a small drop in expectations for the general economic situation during the next 12 months, with the index falling by one point to -21.

The rises in the subindices came in personal household finance views. The index measuring changes in personal household finances rose three points, leaving it at 0, while the index for household finances over the next year rose one point to a score of +10.

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UK Feb consumer confidence index down 1 point to -8 - GfK/NOP UPDATE