Shoppers are feeling more optimistic about the festive season as the financial pressures facing households start to ease, shows Asda’s latest income tracker.
According to the tracker, average household disposable income increased by 12 per cent year-on-year in October, the fastest rate of growth in more than two years.
In tangible terms, the average UK household was £23.04 per week better off in October compared to a year earlier implying this is the first time in more than two years that all households had some disposable income left at the end of the month after paying bills and essentials.
The rise in household disposable income stems from continued annual wage growth and a sharp deceleration in inflation, driven predominantly by falls in gas and electricity prices compared to the previous year.
The improvement in household finances has been accompanied by an increase in consumer optimism about Christmas. More than a quarter (27 per cent) of consumers who took part in Asda’s latest consumer survey said they were excited about Christmas, compared to just 18 per cent last year.
Despite increased excitement about Christmas, the study found that many shoppers are wary of buying festive gifts now because they believe better deals will be on offer closer to Christmas. This time last year, 40 per cent of shoppers had already started their festive shopping, whereas this year, just 30 per cent have begun gift hunting.
Asda Income Tracker is independently compiled by Cebr (Centre for Economics & Business Research) which claims to show how much families have left in their pockets after all taxes and essential bills are paid. ‘The Score’ is a weekly survey of 2,000 UK consumers, tracking customer attitudes and changes in behaviour in response to topical issues.