4 March 2009
Consumers are feeling more confident about making a car purchase in the current climate, according to the Nationwide Consumer Confidence Index. Overall confidence rose for the first time since October 2008, rising by two points to 43 in February. Analysis by the building society indicates that confidence may have been buoyed by falling house and car prices, with many believing it is a good time to make a major purchase. There is also growing optimism about the state of the economy, which could also boost applications in the car insurance market following vehicle purchases. Nationwide Chief Economist Fionnuala Earley said the improved optimism is "encouraging". She said: "Consumers' views about the current economic and labour market conditions are in line with the recessionary climate in the UK. "Spending confidence continues to be resilient, which could reflect the effect of sharp falls in interest rates on consumers' disposable incomes, but is also likely to reflect significant discounts available." Meanwhile, AA Insurance has warned that the new Equalities Bill could potentially impact the cost of insurance for older drivers - with age differences often used to determine risk by providers.