Economic optimism high
A new poll suggests that the public is increasingly optimistic about the economic prospects for the country and their family.
Despite commentators’ worries about the rising level of personal debt and high house prices 73 per cent of those questioned believed that the economy would fare well next year.
This represents a nine-point rise since March last year.
The Populus poll, for The Times, could indicate one reason why the Labour Party and Tony Blair have retained a lead in the polls despite a torrid year including rows over Foundation Hospitals, tuitions fees and the war in Iraq.
Tony Blair has consistently sought to focus on their economic record, pointing to low inflation, record employment and low interest rates.
Despite the economy being a traditional Conservative electoral strength, another recent poll showed that voters are increasingly trusting Labour. An ICM poll in July found that whilst Tony Blair’s personal rating has suffered a battering following the war in Iraq, Labour is far and away the party trusted most to run the economy, 43 points to the Conservatives 36.
Tomorrow the Bank of England’s Monetary Committee will announce whether or not it is to raise interest rates this month, with a quarter of a per cent rise widely expected.
There are some signs that the housing market is slowing down, with a Halifax survey out today showing only a marginal increase in house prices in July. However, house prices are still 22 per cent up on last year and a continuing concern to economists.
A survey from Nationwide, released yesterday, however suggested that 95 per cent of people currently have enough money to pay their mortgage each month, and that rates would have to rise to 6.5 per cent before a significant number of consumers experienced difficulties.
Nationwide’s director, Stuart Bernau, said: “Our research shows consumers remain confident about their ability to manage debt, but are also wary about taking on more unsecured debt in the future. Underpinning this confidence is the current economic climate and employment situation.”
