The global consumer confidence slumped to its lowest in recent times during the 2008-recession jolt. But then, the world economy recovered with a smart ‘V’-shaped rally in the ensuing couple of years, after witnessing a sharp dip in confidence and consumer spending led by challenging global macroeconomics.
However, this consumer optimism was meant to be short-lived as relapse of growth was inevitable. As expected, akin to most of the past recessions, the party didn’t last for long, and the world economy is now staring at tepid growth rate on fears of double-dip recession in developed nations such as the US and the Euro zone.
According to Nielsen Report on Global Consumer Confidence, the global online consumer confidence fell for the seventh consecutive quarter in 31 of 56 global markets amid stagnant US employment figures and worsening euro zone debt crisis. The recessionary mindset has gripped the confidence and spending intentions of 62% in Q3 2011, up 4% from second quarter of 2011.
While there is a growing belief among Europeans and North Americans that the economic recession will continue in the next 12 months; the Asia Pacific region thrived with optimism and high consumer confidence with India perched at the top spot with 121 points followed by Saudi Arabia (120 points), Indonesia (114), Brazil, Philippines (112), Thailand (109), UAE (105) and China (104).
Amongst the nations with worst hit consumer sentiment includes European economies like Hungary (37 points), Portugal (40), Croatia and Romania (40), South Korea (49), Greece (51), Italy (52) and France (56).
Further, the report indicates that the optimistically driven Asia Pacific consumers are more inclined to saving money (61%), as compared to 46% global average of consumers willing to spare cash in savings instruments and various asset classes.
Job security and economic growth has been the top concerns for inhabitants of Asia Pacific, Europe, Latin America, Middle East/Africa and North America. Globally, economic turbulence tops all other consumer concerns such as job security, work/life balance, increasing utility bills, crime and political stability.
However, in a refreshing outcome on the consumers’ future spending intentions, the global respondents were overwhelmingly inclined towards indulgent categories like pleasure travel and vacations (+29%), recreation and entertainment (+20%), going out for dinner (+15%) and shopping into electronics and appliances (+14%). But, these all desire for respite, only if their monthly budget expands by another 10% in future.
While the optimism in Indian consumer confidence came in a trifle lower by 5 points to an index of 121; Saudi Arabia and Brazil, amongst the top consumer confidence nations, logged in a smart growth of 13 points and 16 points respectively.
With high inflation and interest rate scenario, do you feel the party can last for long amongst Indian consumers?