UK consumer confidence rises in December but remains deeply pessimistic

The UK GfK Consumer Confidence index rose to -17 in December 2025, outperforming expectations of -18 and the previous month's -19. This modest improvement is attributed to the Chancellor's budget, which imposed minimal immediate tax increases on households and easing inflation. The confidence level reached ties with October and August, marking the highest level since August 2024, yet it remains weak historically. Notably, households' general economic outlook improved more than personal financial perceptions, while willingness to make significant purchases saw the largest gain, indicating easing caution. Despite this, consumer spending remains weak, with elevated savings rates puzzling economists, suggesting confidence has yet to translate into meaningful consumption recovery.