Youngsters saw improvement in expectations for the economy and household finances, helped by rising real wages among this generation

Consumer confidence, while still negative, saw a slight lift in May following signs of de-escalation in the Middle East.

According to British Retail Consortium-Opinium data, consumer expectations over the next three months showed improvement, for example, people’s financial situation improved to -16 in May, up from -21 in April, in tandem with the state of the economy improving at -48 in May, up from -53 in April.

Personal spending on retail thus rose to +7 in May, which is up from +5 in April, and overall this remained at +15 in May, the same as in April.

However, the proportion of people concerned that conflict in the Middle East could increase the price of non-food rose to 74% in May, up from 73% in April.

BRC CEO Helen Dickinson says that younger consumers are the driving force behind the improvement in expectations for the economy and household finances, helped by rising real wages among this generation.

“But the outlook remains fragile: inflation is set to rise, and more than four in five people expect food prices to climb.

“If the government wants to keep consumer confidence heading in the right direction, it must now make a choice: act now, or let these inflationary pressures spiral, pushing up prices for households.

“Energy prices are pushing up costs for retailers and their supply chains, with the government’s energy taxes and levies making up as much as 65% of business bills.

“Cutting these charges is the fastest way to ease inflation and support consumer confidence. Delay will only make the next cost of living squeeze harder for households.”