A survey has shown that consumer confidence in the UK remains "seriously depressed" despite a surprise rise brought about by falls in inflation and energy prices.
Market research firm GfK NOP said consumer confidence rose four points to minus 29 between December and January to its highest level since June, after improvements in expectations for the economy and people's own finances.
The rise came as a surprise given the worrying state of the economy after a 0.2% contraction in GDP in the final quarter of 2011 fuelled fears of another recession.
The survey said recent falls in inflation, particularly utility bills, may have acted as a ray of light, while the score may also reflect a continuation of the festive mood after Christmas.
Nick Moon, managing director of GfK NOP Social Research, said: "Consumer confidence is still seriously depressed and we should treat this month's modest improvement with caution."
He said another rise in February would be a sign that gloom was dispelling, adding that until then, January's findings should be treated as good, but not great, news.
The survey revealed that people's hopes for the UK economy over the next year had increased eight points to minus 33 between December and January. And perceptions of their personal finances over the past 12 months and their hopes for the next year had also improved.
