A survey from Markit reports lower inflation perceptions and a marginal increase in household spending power are helping to cheers homeowners. Although fears about job security and income from employment continue to balance out the picture.
The index nonetheless pointed to the slowest deterioration in current finances since December 2010. Around 30% of households were downbeat about their finances, compared to 8% that saw an improvement.
It seems Brit optimism has been rising since April 2010. February data pointed to a particularly marked jump in sentiment among people with a mortgage, with the index the highest for almost two years, perhaps reflecting greater confidence that interest rates will stay at record low levels.
In contrast, social housing tenant’s confidence sank to a six-month low, with 56% of respondents expecting their finances to worsen.
Tim Moore, senior economist at Markit said: “Lower inflationary pressures are of course no silver bullet for household finances, and the strain on budgets from weak job market conditions shows little sign of abating. Income from employment dropped again in February, while job insecurities across the private sector were the most acute since mid-2009.
“Encouragingly, recent business surveys have suggested we may avoid a double-dip recession, and perhaps this fillip to confidence will see pockets of stronger consumer demand emerge as the year progresses.”
