Europe Consumer Confidence Unshaken by Economic, Political Uncertainties


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The Conference Board Global Consumer Confidence Index for the Euro Area was unchanged at 89 in the third quarter of 2019 (a reading of 100 or above is considered positive) and even increased by 1 point (from 87 to 88) for the broader European region. Despite further declines in manufacturing activity and political uncertainties around Brexit, both Germany and the UK saw a modest improvement from the previous quarter. Greece experienced a large improvement of 12 points. However, the Euro Area average was held back by large declines in the Netherlands, Ireland and Spain. Beyond the Euro Area, confidence in the broader European region also showed robust gains in the Ukraine and Russia.

An increasing number of European markets are seeing declines in confidence. Out of 34 European markets surveyed, 15 saw a decline in consumer confidence in Q3, of which 8 (out of 16) were in the Euro Area. This is an increase from the prior quarter, especially for the Euro Area where only 4 out of 16 markets saw a decline.

“Despite the lack of momentum in overall consumer confidence, the results suggest a continued positive outlook for consumer spending over the next half year,” says Ilaria Maselli, Senior Economist for Europe at The Conference Board Europe. “Confident consumers will continue to bolster the economy, providing a defense against slowing global GDP growth. However, a continuation of negative news about a possible escalation of geopolitical uncertainties could further increase anxieties about job security and erode confidence in the economy.”  

Globally, despite some softening in large markets—including China, the US, India and Indonesia—consumers across those major markets remain confident. Improvements also occurred in Vietnam, Brazil, Canada and Japan. While Greece saw an exceptionally large increase, Hong Kong and Peru had the largest declines (14 points each).

Job Security, Economic Concerns Bear Close Watching; Global Warming Concerns on the Rise

While job prospects slightly weakened for the Euro Area, more consumers in the region think this is a good time to spend. Consumers, on average, did not exhibit greater concern about the economy.

Fewer consumers in the Euro Area, as well as in North America and the mature economies of Asia-Pacific, have changed their spending or saving habits. Also, an increasing share of consumers in these regions are putting extra cash into stocks/mutual funds, which suggests some confidence that economic and financial conditions will not worsen dramatically.

In several European economies, such as Norway, Romania, Switzerland and Poland, there seems to be a gradually waning interest in spending disposable income on new clothing.

In addition to economic concerns, global warming has been a rising concern across the world over the past several quarters, but more so in the Euro Area where the percentage of consumers citing global warming as their biggest concern increased from 7% in Q2 of 2019 to 12% in Q3.

Highlights for Other Regions for the Third Quarter of 2019

Consumers in Asia-Pacific remain among the most confident globally, but differences across countries have increased. Consumers in the largest emerging markets (China, India, Indonesia) are very positive, despite experiencing some softening in confidence. Other markets, including South Korea, Thailand and Singapore, experienced declines in confidence levels. Hong Kong saw the largest decline across all regions, the result of political unrest in this market.

In North America, optimism about jobs declined modestly, but consumers are unlikely to curb spending. Canadian consumers have shown improvement in confidence, following a drop in the previous quarter. However, with moderate growth prospects and Canada’s high exposure to political and trade risks, consumers are likely to remain vigilant about spending in the coming months.

While confidence increased slightly in Latin America, divergences among countries in the region have also increased. With improved sentiments regarding job prospects and spending, Brazil, Mexico and Argentina experienced the largest increases in consumer confidence in the region, although confidence in Argentina remains very low. In contrast, Peru and Chile saw the second and third largest declines in consumer confidence globally. Peru is experiencing political instability. In Chile, there are heightened concerns about rising unemployment, weakening consumer demand, and trade disruption in key commodities.

Confidence in Saudi Arabia and the United Arab Emirates (UAE) declined. Despite continued optimism about job prospects, consumers across all six markets surveyed in Africa & the Middle East cited job security as their top concern, which may spur more cautious spending decisions.

Index is Recent Addition to The Conference Board’s Economic Indicators Program

The Global Consumer Confidence Index is a recent addition to The Conference Board’s portfolio of economic indicators, which includes the Consumer Confidence Index for the US, The Conference Board Measure of CEO Confidence, the Employment Trends Index, The Conference Board Help Wanted OnLine Index, and Leading Economic Indexes for 12 countries, the Euro Area and globally.

The Global Consumer Confidence Index, based on online responses from 32,000 consumers in 64 markets throughout Asia-Pacific, Europe, Latin America, the Middle East and Africa, and North America, was acquired from Nielsen, which first began the survey in 2005. Nielsen, a leading global provider of information and analytics around what consumers buy and watch, continues to collaborate with The Conference Board on conducting the global survey.

The series for the world, the 64 markets covered and regional aggregates as well as information on several components of the index, including job prospects, personal finances and spending intentions, are released on a timely basis in summary format to the public during the first two weeks of each quarter. Detailed data series are made available on a complimentary basis to members of The Conference Board.

About The Conference Board

The Conference Board is the member-driven think tank that delivers trusted insights for what’s ahead. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States.

About Nielsen

Nielsen Holdings plc is a global performance management company that provides a comprehensive understanding of what consumers watch and buy. Nielsen’s Watch segment provides media and advertising clients with Total Audience measurement services for all devices on which content—video, audio and text—is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry’s only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen also provides its clients with analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries, covering more than 90% of the world’s population. For more information, visit www.nielsen.com. 

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