KARACHI: Consumer Confidence Index (CCI) declined 19.6 percent quarter-on-quarter (Q-o-Q), dragged down by runaway inflation and hobbled rupee, a report said on Monday.
According to a study by Dun & Bradstreet Pakistan and Gallup Pakistan, country’s CCI declined to 70.8 points in the 3Q2021 from 88.0 points in 2Q2021.
“Consumers are taking these declining indicators as signals for further deterioration in their personal as well as economic conditions,” the report said. It added that respondents reported a greater decline in Future Expectations (down 22.7 percent) compared to Current Situation (down 14.9 percent) in this quarter.
In this quarter, all CCI parameters recorded an overall decline, while consumer sentiment witnessed the largest deterioration in regards to Economic Condition of the Country (24.1 percent decline) due to weakening macroeconomic indicators, the study presented.
“Unemployment continues to drag consumers’ enthusiasm and remained the most pessimistic parameter (NI = 54.1).” It said Unemployment Situation deteriorated by 21.6 percent Q-o-Q, while 68 percent of respondents believed that unemployment would increase in the next six months compared to 43 percent in 2Q2021.
In 3Q2021 survey, 94 percent consumers said daily essentials were continuously becoming expensive/very expensive in the last six months compared to 92 percent in 2Q2021. According to Nauman Lakhani, Country Lead of Dun & Bradstreet in Pakistan, the seventh issue of Pakistan CCI report depicts a sharp decrease in CCI 3Q2021 after a slight reco very in Q2 2021.
“… rising inflation and currency depreciation have hurt consumer expectations. All CCI parameters declined Q-o-Q, which reflects increasing concerns amongst consumers,” said Lakhani.
Bilal Ijaz Gilani, Executive Director Gallup Pakistan, said, “Consumer Confidence has taken a turn for the worse in the latest Quarterly CCI report, mostly because of continued inflation in the country together with an uneven growth story emerging”. “Whereas the large manufacturing and export numbers are improving, small traders’ and daily wagers’ economic situation has failed to pick up, widening the gulf between beneficiaries and losers of the growth.”
Gilani said recent government moves, such as PM’s plan for subsidising food commodities, in their (Gallup) assessment, were a right move. “Our next quarter survey will reveal whether it is enough to shore up consumer confidence,” Gilani added.
The CCI report has been developed by assessing Consumers’ Confidence about the economy as well as their personal financial situation. The Index covers four key parameters i.e., Household Financial Situation, Country’s Economic Condition, Unemployment, and Household Savings. The Index reflects ‘Current Situation’ (economic changes witnessed in the last six months), as well as ‘Future Expectations’ (changes expected for next six months) of consumers across the country.
The CCI ranges from 0 to 200, with 100 as the neutral value. A score of less than 100 indicates pessimism while a score of more than 100 optimism.
