November's Index shows households have signalled positive financial outlook for only second time since April, workplace activity and income from employment have both risen again, and elatively weak price pressures have led households to push back forecasts of interest rate rises.
At 44.1, the seasonally adjusted Markit UK Household Finance Index (HFI) pointed to a further decline in financial wellbeing during November. Nonetheless, despite remaining below the average recorded so far in 2015 (44.6), the headline index rose since October (43.8) to a four-month high.
Philip Leake, economist at Markit, which compiles the survey, said: "Markit’s HFI pointed to a further squeeze on household finances during November. That said, the degree of pressure eased to the weakest in four months and was subdued compared with the post-recession trend.
"Meanwhile, renewed optimism was signalled towards financial prospects for the year-ahead. A positive economic dataflow supported the improved outlook – latest figures highlighted lower unemployment and falling consumer prices. However, with wage growth still lagging, households were only slightly upbeat overall.
"Low inflation perceptions contributed to households’ dovish views regarding Bank of England monetary policy. The proportion of respondents anticipating higher interest rates over the next six months was the lowest since October 2013 (23 per cent)."