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INDONESIAN CONSUMERS REMAIN OPTIMISTIC AT THE END OF 2018
Consumer Optimism Regarding Personal Finance is Stable
47 Percent of Consumers Use Their Spare Cash for Vacation
Jakarta, 20 February 2019 – The Conference Board® GlobalConsumer Confidence ™ Survey, in collaboration with Nielsen, recently released the results of its study which showed that the Global Consumer Confidence Index increased one point to 107 in Q4 2018, the highest number in 14 years. Indonesia is still one of the three most optimistic countries in the world.
Indonesian consumers’ level of optimism in Q4 2018 was stable, with the Consumer Confidence Index (CCI) of 127, which increased 1 point compared with the previous quarter of 126. Indonesia ranks third as the most optimistic country globally after India (133) which has increased by 3 points and Philippines (131) which has significantly increased 5 points. (See Chart 1)
In Indonesia, consumer confidence is stable and is likely to hold up amid the upcoming national elections. CCI is formed by three indicators, i.e. optimism toward (1) Local Job Prospects, (2) State of Personal Finances, and (3) Spending Intentions; all in the next 12 months. For Indonesia, the optimism for Local Job Prospects decreased from 73% in the third quarter of 2018 to 68% in Q4 2018. Meanwhile, optimism of the State of Personal Finances was stable with 79% in the last two quarters of last year. The good news is, in the fourth quarter of 2018, 63% of consumers said that the next 12 months is A Good Time for Them to Shop for The Things They Want and Need. This last indicator increased significantly from 57% in Q3 2018. (Chart 2)
Even though The Economy remained in the top list of consumers’ major concerns, in Q4 2018 the percentage slightly decreased (30%) compared to the previous quarter (32%). In this quarter Indonesian consumers’ perception towards economic recession was also more positive, with only 57% of respondents thought that the country is in an economic recession. The percentage significantly decreased from the previous quarter which was 61%. “In general, in Q4 last year consumers were quite confident with their state of personal finances and they were also ready to spend. Most probably this is influenced by the year end holidays period where most of the consumers celebrate the end of the year.” said Agus Nurudin, Managing Director, Nielsen Indonesia. “The year end spirit seemed to bring positive feelings to consumers toward the economic condition.” Agus concluded.
In terms of allocating spare cash, 68% of consumers chose to allocate their spare cash for Savings, 47 percent chose to use it for Holidays/Vacation, 42 percent chose to Invest in Shares or Mutual Funds. Meanwhile, 34% of consumers chose to use their spare cash for Out-of-Home Entertainment (34%) and 29% use it for Home Improvements. (See Chart 3)
CHART 1: TOP 10 CONSUMER CONFIDENCE INDEX (CCI), GLOBAL, Q4 2018
CHART 2: DRIVERS OF CCI (INDONESIA), Q4 2018
CHART 3: CONSUMERS CHANNEL SPARE CASH, Q4 2018
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ABOUT THE CONFERENCE BOARD® GLOBAL CONSUMER CONFIDENCE SURVEY
The Conference Board® Global Consumer Confidence Survey is conducted in collaboration with Nielsen. It was conducted in November 2018 and polled more than 32,000 online consumers in 64 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 survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country.
The Conference Board uses a minimum reporting standard of 60% internet penetration or an online population of 10 million for survey inclusion. The Nielsen China Consumer Confidence Index is sourced from a separate survey conducted by Nielsen China, which is based on a mixed methodology survey of more than 3,000 respondents in China. The Global Consumer Confidence Survey was established in 2005.
ABOUT THE CONFERENCE BOARD
The Conference Board is a global, independent business membership and research association working in the public interest. Our mission is unique: to provide the world’s leading organizations with the practical knowledge they need to improve their performance and better serve society. Winner of the Consensus Economics 2016 Forecast Accuracy Award (U.S.), The Conference Board is a non-advocacy, not-for-profit entity, holding 501(c)(3) tax-exempt status in the USA. Visit http://www.conferenceboard.org
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