U.K. consumer confidence unexpectedly rose in October as sentiment held up before Prime Minister David Cameron’s government unveiled the scope of its budget squeeze, GfK NOP Ltd. said. The index of sentiment increased 1 point to minus 19, the research group said in an e-mailed statement in London today. Economists predicted a drop to minus 22, according to the median of 20 forecasts in a Bloomberg News survey. Gfk NOP compiled the measure from a survey of 2,000 people from Oct. 1 to Oct. 10. “This small rise in consumer confidence for October is really only the prelude to what happens next,” Nick Moon, managing director of GfK NOP Social Research, said in the statement. “Confidence has remained reasonably consistent since June but this could change as the public comprehends the full impact of the government’s cuts.” Chancellor of the Exchequer George Osborne on Oct. 20 detailed plans for the deepest fiscal squeeze since World War II, which will lead to the loss of almost half a million public- sector jobs. While Britain’s economy grew twice as fast as forecast in the second quarter, officials have said the impact of the spending cuts may hamper the recovery. A gauge measuring the economic situation in the next 12 months fell by one point to minus 20, GfK said. The indexes of consumers’ personal finances over the past year and in the next 12 months both rose, as did a measure of the past economic situation. A gauge of the climate for major purchases was unchanged at minus 15. Economic Growth The Bank of England is mulling whether to restart emergency bond purchases to boost economic growth. Minutes of the bank’s October decision showed policy makers are leaning toward expanding stimulus. Still, the economy expanded 0.8 percent in the third quarter, twice as fast as economists predicted, according to figures released this week. Recent data have also shown house prices are declining, with Nationwide Building Society saying yesterday that home values dropped 0.7 percent in October. Mortgage approvals probably fell for a fifth month in September, according to the median forecast of 17 economists surveyed by Bloomberg News. The Bank of England will publish those data at 9:30 a.m. today. To contact the reporter on this story: Svenja O’Donnell in London at sodonnell@bloomberg.net To contact the editor responsible for this story: John Fraher at jfraher@bloomberg.net

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