NIESR doubtful over usefulness of 'consumer confidence' survey

Major new analysis of consumer confidence in the UK was released today.

The National Institute of Economic and Social Research (NIESR) issued the comments, in the wake of a new survey from GfK NOP.

According to the new monthly index, morale rose by three points to -27 in April.

This suggests that optimism is beginning to return to the high street, following months of credit crunch-induced recession.

However, NIESR suggested that the cause of the rise has more to do with trends in household finance - and might not prefigure a surge in consumer spending.

Doubt was also cast on the usefulness of the GfK NOP survey itself.

Martin Weale, NIESR director, said: ’I really don’t know why people bother with consumer confidence indices. They tell us nothing. In the UK they have no predictive power once you allow for what is happening with people’s incomes.

’What this index is saying is something that we knew, which is with falling oil prices and lower interest rates, household incomes have gone up a bit. Beyond that they don’t tell us anything we can’t already tell from other data… [the survey] is not a separate predictor of how much spending will take place.’ADNFCR-2318-ID-19152971-ADNFCR