The UK's recovery prospects were brightened by survey results which showed consumer morale jumped in August while employers took on more staff and price pressures eased.
The Nationwide Consumer Confidence index rose to 63 in August from an upwardly-revised 61 in July. That was the highest since May 2008 and reflected Britons' more upbeat view on current and future conditions as well as a greater willingness to spend.
A separate survey by the Recruitment and Employment Confederation and accountants KPMG showed the number of job appointments rose last month for the first time in over a year.
On inflation, figures from the British Retail Consortium showed shop prices fell 0.1 percent last month to register their first negative reading since February 2007.
Reuters reported that the surveys provide an upbeat backdrop for Bank of England policymakers who kick off a two-day meeting to debate monetary policy on Wednesday.
While the Bank has acknowledged the brighter tone of recent data, it remains concerned about the strength and sustainability of any economic recovery and is not expected to change interest rates or its 175 billion pound asset purchase scheme this week.