Consumer confidence plunges: survey

Published November 9, 2021
Residents wearing facemasks buy vegetables at a market in Islamabad. — AFP/File
Residents wearing facemasks buy vegetables at a market in Islamabad. — AFP/File

KARACHI: Consumer confidence in the country recorded a drop of one-fifth in July-September from the preceding quarter, according to a survey report released on Monday.

Prepared and issued by Dun & Bradstreet Pakistan and Gallup Pakistan, the Consumer Confidence Index (CCI) for the third quarter of 2021 declined 19.6 per cent to 70.8 points from 88 points for the April-June quarter.

“This deterioration in sentiment is driven by weakening macroeconomic indicators, primarily an increase in inflation and rupee depreciation. Consumers are perceiving these declining indicators as signals for further deterioration in their personal and economic conditions,” the report said.

The CCI report assesses consumers’ confidence about the economy as well as their personal financial situation. The index covers four key parameters: household financial situation, the macroeconomic condition, unemployment and household savings. The index reflects ‘current situation’ — economic changes witnessed in the last six months — as well as ‘future expectations’ that take into account changes expected in the next six months across the country.

The CCI ranges from zero to 200, with 100 as the neutral value. A score of less than 100 indicates pessimism while a score of more than 100 indicates optimism.

Respondents reported a greater decline in future expectations (down 22.7pc) compared to the current situation (down 14.9pc) in this quarter.

During the current quarter, all CCI parameters saw an overall decline. Consumers’ sentiments witnessed the largest deterioration with regard to the economic condition of the country (24.1pc decline) owing to weakening macroeconomic indicators.

Unemployment continued to drag consumers’ enthusiasm and remained the most pessimistic parameter. The unemployment situation deteriorated 21.6pc quarter-on-quarter as 68pc of the respondents believed unemployment would increase in the next six months. The percentage of the respondents saying so in the preceding quarter was 43pc.

Published in Dawn, November 9th, 2021

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