KARACHI: Consumer confidence in the third quarter of 2020 improved by 12.1 per cent quarter-on-quarter, Pakistan Consumer Confidence Index (CCI) survey conducted by the Dun & Bradstreet and Gallup Pakistan showed on Tuesday.
“Key findings indicated that consumer confidence improved in Q3CY20 on account of optimistic future expectations amidst complete lifting of lockdown and returning normalcy in trade activities,” it said.
The index covers four key parameters: household financial situation, country’s economic condition, unemployment, and household savings. It reflects the current situation — economic changes felt in the last six months — and future expectations — changes expected for next six months — of consumers across the country.
The index ranges from 0 to 200, with 100 as the neutral value, where a score less than 100 indicates pessimism.
During the 3QCY20, the CCI was 88.7 points, compared to 79.1 points in Q2CY20.
“Current consumer confidence growth of 7pc as compared to the last quarter is healthy; showing signs of recovery in Pakistan,” said Dun & Bradstreet in Pakistan Country Lead Nauman Lakhani.
Meanwhile, Gallup Pakistan Executive Director Bilal Ijaz said that the consumer confidence has shown upward trajectory for third quarter in row which shows that impact of Covid-19 on economy and consumers is slowly tapering off.
The survey showed that economic perception has improved consistently across all three quarters of 2020, highlighting upbeat consumer sentiments mainly on account of optimistic future expectations.
Meanwhile, perception about household financial situation entered into green implying people’s household income seems to be rising after a decline due to Covid-19.
On the other hand, household financial situation in the third quarter was the only CCI parameter to turn overall optimistic owing to improvement in future expectations. Moreover, 30pc consumers surveyed in third quarter believe that their income levels will improve in the next six months compared to 28pc in the second quarter and 32pc in the first quarter.
In contrast, rising inflation and more importantly unemployment continue to drag consumers’ enthusiasm. During the third quarter survey, 91pc consumers believed that daily essentials have continued to become very expensive in the last six months compared to 83pc in the second quarter.
Meanwhile, four out of five — around 77pc — respondents believed that unemployment has increased in the last six months as compared to 80pc in the second quarter and 71pc in the first quarter.
Consequently, two out of three — around 66pc — of the respondents cited a decline in household savings over the last six months compared to 64pc in the Q2CY20 and 57pc in Q1CY20.
On the whole, consumers across all provinces — urban and rural, different age groups and genders were relatively more optimistic for future economic situation, than they were during Q2CY20 survey.
Published in Dawn, November 25th, 2020