(RTTNews) - The UK consumer confidence improved unexpectedly in August, mostly led by factors having short term influence such as cheaper fuel, and is unlikely to be a turnaround in core sentiment.

A monthly survey from the research group, GfK NOP showed that the consumer confidence index rose three points to minus 36 in August. The improvement was at a time when the economists were expecting the indicator to fall to minus 40 from its record low reading of minus 39 registered in July.

The survey is conducted by the GfK NOP on behalf of the European Commission. The research group interviewed around 2001 individuals between August 8 and 17.

According to Rachael Joy in the Consumer Confidence team at GfK NOP, the improvement in confidence could be due to factors which are mostly of short-term influences like cheaper petrol offers, summer holidays happening or just a general feeling of “things can’t get any worse can they?”. In particular, winning gold medals in the Olympics seems too have had a lifting effect, Joy added.

Of the sub indices of consumer confidence, the indicator measuring general economic outlook for the coming twelve months stood at minus 47 in August, better than minus 52 in July. At the same time, personal financial situation outlook rose to minus 12 from July’s minus 18.

Consumers’ assessment about the past general economic situation stood stable at minus 69 in August, which was the lowest reading since December 1992. Meanwhile, the index for personal financial situation over the last twelve months climbed to minus 16.

The gauge that measures the climate for major purchases slid one point to minus 38. The index now stands forty-two points below the same period of the last year and was the weakest on record. Accordingly, the savings index rose one point to plus 21 in August.

The UK economy had stagnated in the second quarter after enjoying positive growth and low inflation for an extended period. The real Gross Domestic Product was flat on a sequential basis in the second quarter and expanded 1.4% year-on-year, which was the weakest since 1992.

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