The Lloyds Bank Spending Power Report for April has found that essential spending growth stayed below 1% for the second consecutive month, amid a new survey high of 138 points for consumer confidence since the survey began in November 2010 – a rise of 29 points from this time last year.
Confidence in the UK's current and future economic situation has continued to increase, with confidence in the UK's economic situation seeing the greatest yearly improvement, with an index of 262 points, a 117 point increase from this time last year.
The improvement in consumers' sentiment towards their own personal finances continues with a positive balance of opinion up 8 percentage points from this time last year, taking it to +14%. Consumers aged between 45-54 continue to be the only group to have a negative opinion towards their personal finances, which has increased further from -4% last month to -7% in April.
Sentiment towards future saving has reached 14% for April, a 4 percentage point increase from last month and up 14 points compared to this time last year. Those aged 18-24 continue to be the most positive towards future saving, with the balance of opinion up by 5 points from last month to 47% in April.
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Meanwhile, the balance of opinion on future spending, rose by 1 point to zero, the strongest since the beginning of the survey and a rise of 6 points from this time last year. With the economy continuing to recover and inerest rates, in time, likely to rise, 71% of consumers said that any change in base rate 'would not have much of an impact' or 'would be able to meet monthly outgoings', if the rate were to rise from its record low.
Among categories of essential spending, customers' average spending on fuel is around 5% lower than a year ago, while spending growth on gas and electricity continues to slow, at around 1% in April compared with around 8% in mid-2013.
Philip Robinson, Director of Personal Current Accounts at Lloyds Bank said: "We are now starting to see a more general air of positivity towards peoples' finances. This will help build consumer confidence and have a trickle affect when it comes to consumer choice on their discretionary spend. Looking towards the summer, this is likely to rise in the months ahead, with customers feeling more in control of their finances."
The Lloyds Bank Spending Power Report is derived from independent consumer research and current account data of Lloyds Bank, Halifax and Bank of Scotland customers. Each month, over 2,000 consumers are asked about their current and future spending habits and how their commitments affect their spending power.