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Consumer confidence up in July

Consumer confidence edged up in July, driven in part by expectations of higher house prices and an end to the economic downturn, the Nationwide Building Society said in its monthly survey today. 

Nationwide's headline consumer confidence index rose to 60 from an upwardly revised 59 in June after a small rise in consumers' optimism about the future outweighed falls in their confidence about the present situation and major spending.

The index is well above the level of 49 recorded in July last year and a series low of 44 in January, but significantly below the levels of over 90 which were typical before the impact of the credit crunch was felt in late 2007.

"Consumer confidence remained broadly stable in July, with limited overall change in sentiment from the previous month. The significance of this stability is that consumers appear to be remaining cautious, but not panicked by the economic climate," said Nationwide chief economist Martin Gahbauer.

"The most significant changes in consumer confidence this month are that confidence in spending has fallen and that for the first time for over a year, consumers expect the value of their homes to rise over the next six months," Nationwide added.

The proportion of respondents who expected Britain's economy to worsen over the next six months fell to 21 percent from 23 percent, though the percentage who expected a shortage of jobs at the same time rose to 60 percent from 54 percent

Moreover, the percentage who thought it a good time to buy a house or a car fell to 35 percent from 40 percent, the biggest drop in this measure for at least a year.

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