Brits are feeling more confident about their personal finances after the General Election, survey data from a major UK bank show.
Lloyds Bank’s spending power index climbed to a new high score of 160, according to figures released today.
Consumers’ assessment of their current situation, a sub-section of the survey, jumped by 11 points to a record high of 213. Household incomes are being boosted by strong wage growth and low inflation. Inflation was just 0.1 per cent in May and has been near zero for the last four months. Meanwhile, pay was 2.7 per cent higher from February to April than it was a year ago.
People were also more upbeat about their job prospects and household finances, the survey revealed.
“Short term spending power confidence has surged in May with less uncertainty after the election, low levels of inflation and strengthening wage growth. These factors are contributing to people feeling like their money is going further this month than last,” said Claire Garrod, head of personal current accounts at Lloyds Bank.
“However, confidence towards finances in the longer term has recently fallen, suggesting that people retain a cautious view of the future.”
The future situation index, another sub-section, dropped for a third consecutive month and is now at its lowest level since August 2013.
“Fewer people now expect to be able to save more, pay off more debt and have more discretionary income in six months time,” Lloyds Bank said.