Consumer confidence declined in six of the seven Latin American markets measured in the first quarter of 2016. Chile was the only country in the region that showed a slight uptick, edging up one point from the previous quarter to an index of 80. In the region’s largest economy, Brazil’s consumer confidence fell for the sixth consecutive quarter, and confidence declined two points in the first quarter to the country’s lowest score (74) in Nielsen’s 11-year consumer confidence history. Favorable job prospect sentiment declined two percentage points to 15%, and immediate spending intentions dropped six percentage points to 26% from the previous quarter.
“In Brazil, consumers continued to seek every opportunity to optimize their household spend,” said Luis Arjona, country manager, Nielsen Brazil. “The overall environment remains challenging for the consumer market, with negative GDP growth, sustained inflation and rising unemployment rates. Nielsen retail sales data in the three months ending February 2016 showed a 2.1% decline in fast-moving consumer goods, and half of the categories in the analysis showed a trade-down to more affordable brands.”
Several other countries in the region followed suit, as confidence fell sharply in Argentina (75) and Colombia (83), declining 13 points and 11 points, respectively, from the previous quarter. Immediate-spending intentions declined dramatically in both countries in the first quarter, dropping 12 percentage points in Argentina to 20% and 13 percentage points in Colombia to 27%. From the previous quarter, positive job sentiment declined by eight percentage points each to 29% in Argentina and 21% in Colombia, and personal finance sentiment declined 10 percentage points in Argentina to 41% and seven percentage points in Colombia to 62%.
“Consumers in Argentina are facing radical changes, as the newly elected government is increasing taxes on earnings and prices on public services such as transportation and utilities,” said Martha Lucía Giraldo, emerging-market leader, Nielsen Latin America. “High inflation and unemployment coupled with low wages are showing a negative impact on retail sales, which are declining.”
“Colombians are worried about the macroeconomic and political environment, as unemployment has climbed and inflation has increased the cost of living,” said Pedro Manosalva, country manager, Nielsen Colombia. “In terms of consumption, however, retail volume and value sales are growing modestly, increasing 2.4% and 5.8%, respectively, in the year ending January 2016.”
Confidence levels also declined five points in Peru (91), three points in Mexico (86) and one point in Venezuela (60) in the first quarter.
Other findings include:
For more detail and insight, download Nielsen’s Q1 2016 Global Consumer Confidence Report. If you would like more detailed country-level data from this survey, it is available for sale in the Nielsen Store.
The Nielsen Global Survey of Consumer Confidence and Spending Intentions was conducted March 1-23, 2016, and polled more than 30,000 online consumers in 63 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.