FT
Tuesday Nov 12, 2024
Friday, 24 February 2012 00:01 - - {{hitsCtrl.values.hits}}
LONDON (Reuters): Consumer confidence jumped in the United States at the end of last year but deteriorated in struggling euro zone countries as policymakers failed to get control over the region’s debt crisis, a survey showed last week.
Global consumer confidence rose slightly from the third quarter, according to the Nielsen Global Consumer Confidence Index, which edged up one point in the fourth quarter of 2011 to 89, but confidence fell in 60 per cent of 56 markets surveyed due to rising concern about the economic outlook.
Just over half of consumers globally described their personal finances for 2012 as good to excellent, up from 50 per cent in the third quarter, but 65 per cent indicated it was not a good time to buy, up 1 per cent from the previous quarter.
In the United States, consumers saw an improvement in their personal finances for the year ahead with 49 per cent saying their personal financial prospects looked good to excellent, up from 43 per cent in the previous quarter and encouraged by signs of an improving labour market.
Consumer confidence in the world’s biggest economy jumped six points to 83.
China also saw a jump in confidence, helped in part by easing food inflation.
Confidence was highest in India for an eighth straight quarter and India’s reading rose by a point from the third quarter to 122. It was followed by the Philippines and Indonesia, reinforcing the trend for rising confidence across Asia.
However, India’s score was well below the country’s record 137 index reading in the second half of 2006, the highest reading for any country in the survey’s near seven-year history.
A reading below 100 indicates consumers are pessimistic about the economic outlook for the coming months.
Confidence was lowest in Hungary, where nervousness about public finances and unorthodox government policies rattled investors and put aid talks with the International Monetary Fund in jeopardy late last year, a situation Budapest has been trying to repair this year.
“In Hungary, a perfect storm of factors is contributing to low and declining consumer confidence,” said Judit SzalokyToth, Managing Director, Nielsen Hungary. “Rising taxes and unpredictable government regulations coupled with declining disposable income has fuelled insecurity and pessimism among consumers.”
Confidence was next weakest in EU/IMF bailout recipients Portugal and Greece while France, Spain, Italy and Ireland were also in the bottom 10, reflecting the impact of the euro zone’s debt problems and austerity measures imposed to try and resolve the crisis.
“While Europe’s challenging economic conditions in the second half of 2011 brought renewed vulnerability and fragility to consumers and financial markets globally, some of the most positive news last quarter came from the world’s two largest economies - the U.S. and China - where confidence rebounded to Q1 2011 levels,” said Venkatesh Bala, Chief Economist at The Cambridge Group, a part of Nielsen.
In the Middle East confidence fell in Saudi Arabia, although the country had the fourth highest level of confidence globally. It also fell in Egypt and Israel, reflecting concerns about job security and political stability across the region.
The survey, taken between Nov. 23 and Dec. 9, covered 28,000 consumers in 56 countries.