Consumer confidence growing in Q2, says BSP

Consumers are feeling better about their financial situations in the second quarter owing to the country’s booming economy and the improved peace and order situation in Mindanao.

The Bangko Sentral ng Pilipinas (BSP) said the improvement in consumer confidence, as shown by the results of its nationwide Consumer Expectations Survey (CES), in the second quarter suggested that economic growth would accelerate in the coming months.

BSP Deputy Governor Diwa C. Guinigundo said the correlation between the BSP’s quarterly consumer confidence index and gross domestic product (GDP) growth in the past years had proven to be “statistically significant.”

The overall confidence index for the second quarter improved to -17.3 percent from -18.8 percent in the second quarter.

This means that although there were more people who felt optimistic about their prospects, they were still outnumbered by pessimists.

Consumers’ confidence is measured using three indicators, namely their perception of the performance of the economy, their family financial situation, and family income.

“For the current quarter, respondents were more confident about the country’s economic condition and their family income,” the BSP said.

The outlook for their family finances, meanwhile, remained unchanged.

Respondents of the survey, conducted from April 1 to 12, cited five main factors for their improved outlook, namely availability of jobs, rising salaries, stepped-up road infrastructure projects, higher investments, and the improvement in the peace and order situation.

Meanwhile, respondents that felt negatively about their own situations cited the expectation of lower incomes due to the effects of bad weather on their harvests, higher household ex      penses due to the start of the school year, and fewer job opportunities.

Last month, the BSP’s similar Business Expectations Survey, which measures the sentiment of private companies, showed that the overall confidence index (CI) rose to 50.7 percent from 37.8 percent in the Q1 2014 survey.

Results of both surveys are tracked by the BSP and the National Economic Development Authority (Neda) as among the leading indicators for the performance of the Philippine economy.