Consumer confidence has grown at its fastest rate for a year, boosted by a cheerier outlook for household finances.
The YouGov/Cebr Consumer Confidence Index saw its largest month-on-month jump since January 2017, rising to 108.2 from 107.1 in December.
The move builds on a recent slew of bright economic data, with UK gross domestic product (GDP) growing by a better-than-expected 0.5% in the fourth quarter and inflation rolling back to 3% in December.
However, January’s confidence reading is still tracking below a figure of 109.8 recorded during the same month last year.
Nina Skero, head of macroeconomics at the Centre for Economics and Business Research (Cebr), said: “Higher-than-expected GDP figures, a drop in inflation and now an uptick in consumer confidence – the new year is off to a promising start.
“With household finances and upcoming business activity metrics both on the rise, the 2018 slowdown that many had expected looks less likely to materialise.
“At Cebr, we expect the UK’s economic performance this year to remain broadly in line with that seen in 2017.
“It’s not all good news though, as consumers remain doubtful about job security and future house prices.”
The research, sourced from more than 6,000 interviews, showed people felt their household finances would improve over the next year, with the reading climbing to 95.5 in January, up from 90 in December.
The rise was also higher than the 93.1 recorded in January 2017.
Expectations for business activity to rise over the next 12 months also picked up to 118.2 in January compared with 116.6 in December.
However, the research found that more people were feeling less secure about their jobs in the year ahead at 109.4 in January, down from 110.3 in December and lower than 109.5 recorded in January last year.