Local Consumers Increasingly Pessimistic about Their Finances and Job Prospects
Overall Confidence in Asia-Pacific was Down
HONG KONG, 25 November, 2015 – Hong Kong consumer confidence dropped 6 index points in the third quarter to a score of 99, the biggest quarterly decline since 2013, according to the Nielsen Global Survey of Consumer Confidence and Spending Intentions. The Nielsen Consumer Confidence Index (CCI) measures perceptions of local job prospects, personal finances and immediate spending intentions, surveying more than 30,000 respondents with Internet access in 61 countries.
In the latest round of the survey, conducted August 10 – September 4, 2015, global consumer confidence recorded an increase of three index point from the previous quarter to a score of 99. Within the region, consumer confidence in Hong Kong is higher than that in Taiwan (72) but lower than China (106) and Singapore (101). Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism, respectively.
Drivers of Consumer Confidence
Nielsen found that Hong Kong consumers are feeling more pessimistic about the three key CCI drivers: the state of their personal finance, job prospects and spending intentions. Around two-out-of-five Hong Kong respondents believed job prospects (45%) and their immediate spending capacity (47%) would be good/ excellent in the next 12 months, a decrease of 8 percentage points and 5 percentage points, respectively, from the second quarter.
“In Hong Kong, a pessimistic mind-set permeated consumer sentiment for more than half of respondents (56%) as consumer confidence declined dramatically in the third quarter,” said Yan Xuan, president, Nielsen Greater China. “As private consumption growth slowed by 2.8% and exports dropped by 1.3%, labor forces are feeling the pain from the economic slowdown. Additionally, the plunge in stock and commodity prices by 30%-40% in August-September has taken a toll.”
When comparing to the last quarter, discretionary spending intentions among Hong Kong consumers decreased in nearly all categories measured, as more of them would cut out more on annual vacation (from 22% to 27%), cut down on holidays/ short breaks (from 31% to 34%) and spend less on buying new clothes (from 52% to 53%).
What are Consumers Concerned About?
Concern over local economy increased significantly, from 13% on Q2 to 17% this quarter. Also, respondents from this survey are becoming more concerned on the increasing food prices (from 8% to 10%). Consumers are keeping an eye on the latest inflation development, though it is expected that inflation should remain contained in the near term given the soft import prices and moderate local cost pressures. As the global economic outlook in the near term remains mediocre, Hong Kong’s economic growth in the fourth quarter would have to rely on the domestic sector as the key propeller.
ABOUT THE GLOBAL SURVEY OF CONSUMER CONFIDENCE AND SPENDING INTENTIONS
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted Aug. 10 - Sept. 4, 2015 and polled more than 30,000 online consumers in 61 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample includes Internet users who agreed to participate in this survey and has quotas based on age and sex for each country. It is weighted to be representative of Internet consumers by country. Because the sample is based on those who agreed to participate, no estimates of theoretical sampling error can be calculated. However, a probability sample of equivalent size would have a margin of error of ±0.6% at the global level. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion. The China Consumer Confidence Index is compiled from a separate mixed methodology survey among 3,500 respondents in China. The sub-Saharan African countries in this study are compiled from a separate mobile methodology survey among 1,600 respondents in Ghana, Kenya and Nigeria. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.
Nielsen Holdings plc (NYSE: NLSN) 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 across all devices where 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 provides its clients with both world-class measurement as well as analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90 percent of the world's population. For more information, visit www.nielsen.com.
 Morocco was added to the Global Survey in the third-quarter of 2015, and the country’s index is reflected in the Middle East/Africa regional average.