GfK’s Consumer Confidence Index stood at -27 in May, unchanged from -30 in April, reflecting cautious optimism as UK households balance high inflation with strong labour-market conditions.

Confidence Snapshot

GfK Consumer Confidence in May

The headline index of -27 is far below neutral territory but well above the -49 pandemic trough, signalling that consumers are adapting to cost pressures rather than withdrawing entirely from spending.

Historical Perspective

With long-term peaks around +10 and troughs near -39, the current -27 suggests we may be nearing a bottom for this cycle, offering insight into potential equity opportunities.

Spending Implications

Shifts in sentiment impact sectors unevenly. Here are today’s winners and losers:

Sectoral Winners

• Travel & Leisure: Pent-up demand benefits IAG and Whitbread as international travel and domestic tourism recover.
• Home Improvement & DIY: Remote-work trends support B&Q and Kingfisher in resilient home-upgrade spending.
• Technology & Electronics: Higher-income households keep buying innovation, aiding Currys and AO World.

Sectoral Losers

• Luxury Goods: Brands like Burberry may see pullbacks as consumers trim high-end discretionary purchases.
• Restaurants & Dining: Budget constraints weigh on casual-dining names such as Mitchells & Butlers.
• Clothing & Apparel: Fast-fashion like Boohoo faces slowdown amid cost pressures and second-hand competition.

Actionable Tips

• Consumer-Discretionary Play: JD Sports Fashion (LSE: JD) – Athleisure resilience and international expansion make it a buy amid stable youth spending.
• Consumer-Staples Play: Unilever (LSE: ULVR) – Defensive exposure to household essentials like Dove and Knorr, with sustainability driving loyalty and growth.

Subscriber Insight

Advisor’s Gateway subscribers accessed our Consumer Confidence Trend Tracker early, spotting market shifts and aligning equity portfolios with sentiment before peers.

Keep Calm and Carry On Spending

The stabilisation in consumer confidence offers selective opportunities in resilient sectors. Subscribe now for fortnightly insights, consumer-sentiment plays and actionable investment ideas.