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Latin American Consumers Show Uncertainty Heading Into 2015
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Latin American Consumers Show Uncertainty Heading Into 2015

Mirroring consumer confidence declines seen around the world, sentiment in the Latin America region decreased three index points to a score of 88 in the fourth quarter, as scores fell in five of the seven countries measured. Peru was the only country in the region where confidence improved and remained above the 100-score optimism baseline, rising four points to 101. Peru’s latest reading outperformed Brazil’s score, which dropped six points to 95, for the first time since 2011. Similarly, Mexico (85) decreased three points, Colombia (94) and Chile (81) decreased four points each, and Argentina (67) dropped one point. Venezuela’s score (70) was flat from the previous quarter.

There were few silver linings to be found in the region, as the outlook for job prospects declined in three of seven Latin American countries, and perceptions of personal finances fell in all countries except Peru. Furthermore, recessionary sentiment worsened by seven percentage points in both Brazil (73%) and Chile (59%)—the highest levels since Nielsen started tracking this sentiment in 2008.

“Brazil’s confidence score is a reflection of high levels of uncertainty about the economic environment,” said Luis Arjona, cluster leader, Nielsen Brazil. “In addition to the expected low growth levels in 2015, inflation has remained above the official targets, and there are growing concerns about increasing unemployment rates. On the other hand, a newly-appointed economic team has recently taken measures to restore confidence by increasing interest rates to subdue inflation and promising to restore greater fiscal discipline. Reports of corruption at Petrobras, the largest Brazilian company, and the steep drop in oil prices, have further contributed to market uncertainty and overall consumer sentiment. Relatively low consumer confidence scores should remain in the near future, until the region embarks on a clear path to economic recovery.”

Consumer trepidation was further reflected in discretionary spending intentions, which showed the most dramatic pull back of all the regions. Decreases of five percentage points were reported for new clothes (24%) and home improvements (15%), four points for new technology (16%), three points for saving (28%) and two points for out-of-home entertainment (30%). Almost one-in-five respondents (18%) said they have no spare cash, a quarterly increase of two percentage points.

Other findings from the latest Consumer Confidence report include:

  • Confidence in India increased to a score of 129, the highest of all countries measured.
  • North American consumer confidence tied the Asia-Pacific region for the second consecutive quarter.
  • Eleven markets post double-digit year-over-year confidence climbs.

For more detail and insight, download Nielsen’s Q4 2014 Global Consumer Confidence Report.

About the Nielsen Global Survey

The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted Nov. 10-28, 2014 and polled more than 30,000 online consumers in 60 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample has quotas based on age and sex for each country based on its Internet users and is weighted to be representative of Internet consumers. It has a margin of error of ±0.6%. 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.