UK consumer morale rises to 6-mth high -Nationwide

British consumers were their most upbeat in May since the end of last year as people became more confident about the prospects for the economy, a survey showed on Wednesday.

The Nationwide Building Society's consumer confidence index rose to 53 last month from 51 in April, the highest since November. And people were hopeful that conditions would improve in six months' time, with the expectations index rising to 76 from 71, the highest in more than a year.

Still, the rise in May's headline index rise was much smaller than April's 8-point leap, reflecting anxiety about the current economic climate.

The present situation sub-index fell to 17 last month from 21 in April — the lowest in the survey's 5-year history.

"As we continue to see contrasting news about the state of the economy, it is likely that confidence will remain fragile," said Martin Gahbauer, Nationwide's chief economist.

"While some reports suggest tentative signs of a slowing in the pace of economic decline, it is important to remember that a number of sectors are continuing to contract and any recovery is likely to be sluggish."

Britain's economy shrank by 1.9 percent in the first three months of this year, the steepest decline in 30 years, and the contraction for 2009 as a whole is likely to be the worst in Britain's post-World War Two history. But recent surveys have suggested the economy may have passed through the worst of the downturn and policymakers are hoping that record low interest rates and efforts to pump cash into the economy will help things along. The spending sub-index rose one point to 101 in May, although there were falls in the percentage of consumers who felt it was a good time to buy household goods or make major investments, such as to buy a house or car.

Separate figures from the British Retail Consortium showed shop price inflation eased in May to 1.3 percent from 1.4 percent.