Live Chat Software
Berita Dan Riset Terbaru
Consumer Confidence
Consumer Confidence Agustus 2019
July 31, 2019 14:12

Danareksa’s Consumer Confidence Index (CCI) rose to 102.0 in July 2019 from 100.7 in June. Both indicators – i.e. the Present Situations Index (PSI) and the Expectations Index (EI) - increased by 2.8% mom and 0.5% mom to 87.0 and 113.2, respectively. Consumers gave increasingly positive assessments toward current economic conditions and the job market. The proportion of consumers claiming that current economic conditions were “good” increased from 22.0 percent to 23.4 percent. In addition, consumers were more upbeat on the outlook for local business conditions and their family incomes over the next 6 months. The percentage of consumers expecting that their family incomes will improve over the next six months increased from 21.4 percent to 23.9 percent.

The CCI for urban consumers rose by 2.9% mom to 103.7, while the CCI for rural areas slipped to 98.0 (-2.5% mom). By province, the CCI increased in three of them: Jakarta (+2.5% mom to 117.3), North Sumatera (+12.8% mom to 96.1), and South Sulawesi (+4.9% mom to 84.6). By contrast, the CCI fell in West Java (-0.7%), Central Java (-4.6%), and East Java (-2.5%) to 101.3, 110.9, and 107.0, respectively.

By income level, the CCI for mid-income consumers (between IDR 1.5 mn-3.0 mn/month) rose to 98.5 (+2.9% mom) and for high-income consumers (above IDR 3.0 mn/month) the CCI climbed to 109.5 (+0.8% mom). By contrast, the CCI for low-income consumers (below IDR 1.5 mn/month) fell by 3.5 percent to 90.3. Lower CCI for low-income consumers was related to falling CCI for rural areas. However since the CCI readings stayed above their 12-month averages, this reflects relatively strong consumer confidence, suggesting there will not be any significant pullback in consumer spending in the months ahead.

Our survey shows that 69.5 percent of consumers worry about higher foodstuff prices (up from 65.8% in the previous month) as well as job scarcity (up to 42.3% from 33.9% in the previous survey). Notably, there have been recent increases in the prices of rice, chilis, and vegetables in July following the Idul Fitri festivities. However, consumer concerns on potential natural disasters dropped from 6.8 percent to 4.6 percent. Since the new school year has begun, 0.12 percent of consumers also cited rising education costs as a concern.

Most consumers expect milder inflationary pressures and lower interest rates over the next 6 months. The index measuring consumer sentiment toward general prices and interest rates fell by 1.0% and 0.2% to 173.1 and 121.5. At the same time, consumers in the main cities are pessimistic on the outlook for the rupiah (this index dipped 1.0% to 66.0).

The Buying Intentions Index gained traction in July. It rose to 192.2 (+1.8% mom), suggesting that buying intentions are solid. This also indicating that consumers more confident to long term economic outlook. Of the ten categories of goods tracked by our survey, buying intentions rose in five of them (cars, motorcycles, bicycles, land, and houses). Stable consumer purchasing intentions for durable goods over the next six months should be maintained since the index is significantly higher on an annual basis (+14.1% yoy).

Inline with the increase in the CCI, the Consumer Confidence in the Government Index (CCGI) rose 4.4% mom to 116.4, following a 0.5% increase in the previous month. All the CCGI components posted monthly increases, indicating that consumers are still generally convinced in the government’s ability to carry out its duties. Consumers have greater confidence in the government’s ability to spur economic growth (+5.8% mom to 115.7), provide and maintain public infrastructure (+1.2% mom to 121.9), stabilize general prices (+4.8% mom to 105.8), ensure a safe and orderly environment (+3.3% mom to 118.6) and enforce the rule of law (+7.3% mom to 120.1).