UK households still have to deal with challenging financial conditions.
This is according to Alliance Trust and it comes after the group's UK Financial Reality Index for the first quarter of 2012 rose from 62.1 to 66.4.
However, this is still well below the critical level of 100, as rising unemployment, consumer debt and weak GDP growth continue to have a detrimental effect on Britons.
Linsey Thomson, senior economic analyst at the Alliance Trust Economic Research Centre, observed that "financial conditions are still weaker than the long-term average".
She added: "The persistent weak level of financial conditions therefore points to continued muted consumer spending growth as we move through 2012".
The household budget index rose from 61.7 to 67.5, which highlights the fact individuals have seen a slight improvement in this area, but it has not been above the 100 level since 2010.
This measure improved in the first three months of 2012 as a result of a fall in inflation, which brought down the cost of basic goods.