Optimism returns for consumers

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Consumer optimism over the economy continued to run at a three-year high in September amid a blossoming housing market and a further easing of concerns about employment.

The Lloyds Bank Spending Power Report said that a new peak of consumer sentiment which had been recorded in August grew stronger in September, to reach the highest levels since records began in November 2010.

For the first time since the survey began, more people think they will have more money to spend in the coming months after paying household bills rather than less, with a net balance of one per cent more people saying this.

The pace of consumer confidence is continuing to accelerate, although energy bill prices remain a concern for more than three-quarters (77 per cent) of consumers, the research found.

The research was carried out just before Centrica-owned energy giant British Gas announced it was hiking electricity bills by 10.4 per cent and gas tariffs by 8.4 per cent – affecting 7.8 million households, and SSE announced it was hitting seven million customers with an 8.2 per cent rise.

Sentiment about employment was at its least negative since the survey began. Some 78 per cent of consumers were downbeat about the employment market, edging down from 81 per cent in August.

But those approaching retirement were the most pessimistic, with 87 per cent of 56 to 64-year-olds not feeling good about the employment market.