Consumer confidence has grown at its quickest rate since August, as shopper sentiment continues to rally following the shock of the Brexit vote.
According to YouGov and CEBR, the Consumer Confidence Index jumped two points in January to 100.3 – the biggest month-on-month increase for five months.
The strong month-on-month growth meant the index reached its highest level since last September, when it stood at 111.5.
However, YouGov/CEBR said consumer confidence remained “notably below” the level it was prior to the EU referendum last June.
Shopper sentiment improved in seven of the eight measures used to evaluate confidence, with consumers most confident about house values over the next year, business activity in the workplace over the past 30 days and expected business activity over the coming year.
“Sting in the tail”
CEBR director Scott Corfe hailed the economy for defying “the gloomy predictions of the Treasury since the Brexit vote,” but he warned there may be “a sting in the tail”.
“Inflation is picking up and the rising cost of living could start to erode consumer confidence, particularly if pay growth stays subdued,” he cautioned.
Stephen Harmston, Head of YouGov Reports, added: “While the improvement in confidence is good news for the economy and reflects a resilience, when it comes to the consumer impact of Brexit we are still very much in the early stages.
“However, at the moment, things look good.”