Consumer confidence continues slide in Q2

Consumer confidence continues its downward spiral in the second quarter with the Bangko Sentral ng Pilipinas’ (BSP) periodic confidence index (CI) falling to negative 24.2 percent from negative 23.1 percent the previous quarter.

The first quarter’s negative 23.1 percent CI was already a substantial slip from the negative 8.5 percent for the final quarter of last year.

The survey for the current quarter showed the number of respondents reporting higher family incomes being offset by those who said they were affected by the high cost of petroleum products and higher prices of goods and services.

The slight increase in the level of pessimists was carried over to the next quarter with the CI at negative 7.8 percent from negative 6.2 percent a quarter ago.

Consumers have a brighter outlook in the year ahead with the CI at 4.4 percent from 1.2 percent a quarter ago based on the latest survey.

Consumers’ perceptions on three indicators: the country’s economic condition, family financial situation and family income were mixed in the second quarter, the survey showed.

The outlook on family financial situation and family income slightly improved as more respondents cited anticipating additional incomes due to good harvest and more jobs available in the second quarter.

However, the continued increase in the prices of commodities dampened their sentiment on the economic condition of the country during the current quarter.

Across income groups, respondents’ views about the economic condition of the country weakened during the quarter.

However, their sentiment on the family financial situation and family income were mixed. A greater number of respondents from the low- and high-income groups had more favorable perceptions about their family financial situation and family income than otherwise, while in the middle-income group, those having more optimistic views about their families’ finances declined compared to the previous quarter’s survey.

Household expenditures on basic goods and services are expected to rise in the third quarter.

More consumers expected higher expenditures on basic commodities in the third quarter compared to the previous quarter.

The survey showed higher expenditures being expected by respondents primarily on transportation, fuel, personal care and effects, and education.

“This indicated that inflationary pressures could come from these goods and services,” according to the BSP survey.

The bulk of OFW households (97.2 percent) used remittances for food. More than two-thirds of households surveyed (69.4 percent) allocated their remittances for education, 59.6 percent for medical payments and 46.4 percent for debt payments. The percentage of OFW households that utilized their remittances for savings went up to 44.0 percent (from 41.4 percent in Q1 2011). Meanwhile, the percentage that apportioned part of their remittances to purchase consumer durables, car/motor vehicles and houses and lots increased compared to the previous quarter’s survey results. Likewise, the use of OFW remittances for investments increased to 6.8 percent from 5.7 percent in Q1 2011.  –Daily Tribune