Gfk Consumer Confidence

The GfK Consumer Confidence Barometer tracks UK consumer sentiment on household finances, the general economy and the major-purchase climate. GfK, whose name means Growth from Knowledge, has run it monthly since January 1974. It is run with the Nuremberg Institute for Market Decisions (NIM), its not-for-profit founder.

The survey covers about 2,000 people aged 16+ and is nationally representative with quotas for age, sex, region and social class. It uses an online survey with yearly phone calibration and an estimated margin of error of +/-2%. It measures opinions, not actual spending, saving or output, on a scale from -100 to +100 with no official threshold; 0 is not neutral.

Fieldwork runs in the first half of the survey month, with special surveys covering other windows. Results are normally published at 00.05am on the last working day of the month, with an annual list of release dates.

Each release shows the five component balances, the separate Savings Index, commentary and survey notes. Charts cover the headline trend with the Bank of England MPC rate, the components and the annual moving average. The headline uses underlying data to two decimal points.

The headline (Overall Index Score) moves with five balances of equal weight.

• Personal finances, last 12 months, 20%: how the household financial situation changed over the past 12 months.
• Personal finances, next 12 months, 20%: expected change in the household financial position over the next 12 months.
• General economy, last 12 months, 20%: views on how the national economic situation changed over the past 12 months.
• General economy, next 12 months, 20%: expectations for how the national economy will develop over the next 12 months.
• Major Purchase Index, 20%: whether now is the right time for people to make major purchases like furniture or electrical goods.

On July 29, 2016 the headline fell 11 points from -1 to -12, after -9 in the early-July special survey. That was the sharpest monthly drop for more than 26 years, since March 1990.

All five components fell, with the Major Purchase Index at -2, down 11 points. The year-ahead economy balance fell 19 points to -33, while the past-year measure fell 12 points to -25. The Savings Index fell 4 points to +1 but stays outside the headline. This shows the headline is a straight average of five balances, so forward views can fall faster than past views.

1. Score answers: Questions 1 to 4 give +1, +0.5, 0, -0.5 and -1 from a lot better to a lot worse. Question 8 gives +1 for right time, 0 for neither and -1 for wrong time. The Savings Index gives +1, +0.5, -0.5 and -1 but stays outside the headline.
2. Component balance: each question mean is multiplied by 100 to give a balance from -100 to +100. Example with 100 people: 30 at +1, 40 at 0 and 30 at -1 gives a mean of 0 and a balance of 0.
3. Headline average: the Overall Index Score averages the five balances and divides by 5. It is an average of averages from data to two decimal points. For example, balances of +10, +20, -30, -20 and 0 give (10 + 20 - 30 - 20 + 0) / 5 = -4.
4. Seasonal adjustment: no adjustment is applied to UK data, so regular seasonal patterns stay in. The EU adjusts its figures, so monthly moves can differ while the long-term trend is not affected.