Consumer confidence improves in 4th quarter

Consumer confidence improved to its highest level in two years during the fourth quarter on the back of expectations of increased government spending as well as more job opportunities ahead of next year’s elections, the Bangko Sentral ng Pilipinas’ (BSP) latest Consumer Expectations Survey (CES) showed.

The fourth quarter CES showed that the overall confidence index (CI) went up to negative 8.1 percent from negative 11.6 percent in the third quarter. “The higher (but still negative) CI for the fourth quarter of 2015 means that the number of households with an optimistic view increased but was less than those who think otherwise,” the BSP explained.

The CI reverted to negative single-digit for the first time since the negative 7.9 percent recorded in the third quarter of 2013.

“According to respondents, their more favorable outlook during the current quarter was due to expectations of more jobs and increase in the number of working family members; additional income/higher salary given the receipt of Christmas bonus and 13th month pay; stable prices of commodities; effective government policies; improvements in infrastructure, and brisker business activity leading to higher household income,” the BSP said.

In a press conference, BSP Deputy Governor Diwa C. Guinigundo said they expected consumer optimism to further pick up early next year. “During election years, consumer confidence blips up, associated with more spending and more job opportunities available,” he explained.

For the first quarter of 2016, the BSP said consumers’ optimism “was sustained as the CI was broadly steady at 5.7 percent compared to the previous quarter’s survey results.”

“Consumers’ sentiment was more favorable for the next 12 months, with the CI increasing to 18 percent from 15.8 percent a quarter ago. Consumers anticipated lower unemployment, improvements in the country’s economy and the election of new government officials for the year ahead,” the BSP added.