UAE's sunny disposition! The Emirate state makes world's top ten for consumer confidence
The UAE ranks among the world’s top ten countries in consumer confidence with an index reading of 107, far surpassing the global consumer confidence indexed at 94 in the second quarter, a survey shows.
Indonesia topped the global ranking with an index of 124 as its consumers were the most buoyant globally, according to Nielsen’s Global Survey of Consumer Confidence.
Indonesia was followed by the Philippines with an index of 121, India (118), Thailand (114), Brazil/China (110) and the UAE/Hong Kong (107). Saudi Arabia, with an index of 100, is the only other Middle East nation to make the top 10 in consumer confidence.
In the Middle East and Africa markets, apart from the UAE and Saudi Arabia, consumers are more upbeat about the economic outlook in Pakistan (98), recording a three-month increase of 11 index points, followed by a rise of three points in Egypt (77) and South Africa (81).
Consumer confidence levels above and below a baseline of 100 indicate degrees of optimism and pessimism. Overall, the index rose one point in the second quarter to 94, after rising two points in the previous quarter. A reading below 100, however, signals consumers are pessimistic overall about the outlook.
Overall confidence in the Asia-Pacific remained high, with seven markets reporting indexes above the 100 baseline. In addition to China’s increase, Indonesia and the Philippines reported increases in the second quarter of two and three points, respectively. India, Thailand, Hong Kong and Malaysia declined two, one, one and four index point(s), respectively. The UAE reported a slight decline of one point.
“While confidence in Europe remained in a holding pattern as financial conditions stabilised, perceptions about jobs, personal finances and spending intentions increased in the world’s three largest economies — US, China and Japan — which is having a beneficial effect around the world,” said Dr Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen. “However, concerns remain that macroeconomic events, such as too sharp a rise in interest rates, can impair the consumer recovery, including lowering the demand for home purchases and spending on big-ticket items.”
Consumer morale improved in the US, the world’s biggest economy, reflecting increasing employment opportunities, higher home prices and a rising stock market, Dr Bala said. “When consumers feel richer and also more secure about getting a job or keeping their job, that naturally makes them more confident... It’s the reverse of what happened in 2008-09 when job layoffs soared and house prices collapsed along with the bottoming of the stock market.”
Japanese consumer confidence jumped in the wake of Prime Minister Shinzo Abe’s aggressive efforts to revive the economy. Consumer confidence increases were reported in the Asia-Pacific (up two points to 105), North America (up two points to 96) and Middle East and Africa (up six points to 91), compared to the previous quarter. Europe’s consumer confidence index remained flat at 71 for three consecutive quarters and Latin America’s confidence declined one index point to 93 in second quarter.
In other key economies, consumer confidence increased three points in the United States (96), increased two points in China (110), increased five points in Japan (78) and remained flat in Germany (90). Portugal reported the lowest index at 33, flat with the first quarter. Nine of the 58 countries in the survey reported a confidence index above the baseline level of 100.
Consumer confidence declined in 14 of 29 European markets, and the region included nine of the bottom 10 consumer confidence index scores, including Hungary, Italy, France, Greece and Spain. Confidence increased in thirteen European markets, including the United Kingdom, up four index points to 79.