Does the pick-up in consumer confidence point to an economic recovery? And does it mean the economic stimulus on both sides of the Atlantic is working? Without sounding too much of a fence-sitter, “possibly” and “maybe”.

A sustained upturn in consumer confidence, which is a forward indicator, can certainly suggest a recovery is coming. It can even be rising while unemployment, a famously lagging indicator, is also on the way up. But there are other possible pointers to a recovery.

The “PMI” data, a measure of business activity and another solid forward indicator, has been creeping steadily higher for several months. It shows that the services sector, which accounts for three quarters of the economy, is still contracting — but is doing so at its slowest rate for six months.

Similarly, the Royal Institution of Chartered Surveyors reported recently that new homebuyer inquiries are up for the fifth month running and estate agents have fewer unsold properties on their books than at any time since the Northern Rock crisis began in September 2007.

Whether this is down to the stimulus is debatable. When jump leads are applied to a car engine there is usually an immediate reaction but, with an economy, there tends to be a delay. So it is harder to judge whether this nascent recovery is due to the jump leads being applied or to some other external factor, such as oil prices halving during the past nine months. However, given the size of the stimulus, it would be amazing had it not played some part.

We should not be surprised that consumer confidence is recovering. Despite rising unemployment, real disposable incomes are up sharply in recent months, thanks to lower interest rates and taxes.

Explore Economics

• Pre-Budget Report 2009

• Budget 2009

• World Economic Forum

• The Times MPC

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive