Consumer confidence rose in August
KASI CCI rose 2 percent in August
Spending and job security dampen outlook
Low inflation drives positive expectations
The month of August saw a +2 point increase in the consumer confidence index score from its July value of +7. Across the 7 countries that participated in the survey, 6 of these showed positive growth in consumer sentiment, with Tanzanian having the highest recording. This may not be surprising in light of the recent cuts in the discount rate made by Tanzania’s central bank from 9 to 7 percent, accompanied by an annual inflation rate that has remained stagnant at 3.3 percent, the lowest rate achieved since 1999. On the other hand, despite the 3 point drop from the subsequent month, consumers in Nigeria maintain a positive index score (+17).
Consumer confidence remains mute across Africa in August
Spending and job security dampen short-term outlook
Consumers’ evaluation of current economic conditions remained constant at -13 while expectations rose by 2 points to +18. A closer look into survey results shows that, though Ghana has the highest percentage of individuals with expectations of an improvement of the current economic disposition, the number of individuals anticipating this improvement has been diminishing continuously over the past 3 months. Though Ghana’s current disposition may not be described as a crisis, the hiking crude oil prices together with a depreciating currency have had the effect of dampening a positive outlook.
A 1 percent increase to 18 percent was recorded of individuals intending to make large purchases such as furniture or electrical appliances for the month’s survey. The evaluation of job prospects revealed a percentage reduction to 37 percent of individuals that claim greater difficulty of acquiring a job, while only 7 percent claimed that it will be easier to find a job. It is worthwhile noting the significant drop from 77 percent recorded in July to 50 percent in August, of individuals who claimed difficulty in acquiring a job in Tanzania. This observation is coherent with Tanzania’s recent economic policy changes described above.
Personal finance remains stable
Consumers' appraisal of household income improved by 4 points to +26. In fact, 36 percent of consumers expect an increase in their household income over the next 6 months. Despite these expectations, consumers' appraisal of their personal finance declined by 1 percent to 24 percent as lesser individuals anticipate their ability to meet their regular expenses.
Low inflation drives positive expectation
As per our expectation, lower inflation continues to drive positive outlook in countries such as Tanzania (3.3 percent in August) while higher inflation may drive negative outlook in countries such as Ghana (9.9 percent in August).
Forthcoming consumer data releases:
October 15th: KASI CCI (September data)
October 31st: KASI FIT Index (2018 data health and wellness data)
Esther Bosha, Junior economist, KASI Insight
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The KASI Consumer Confidence Score (KASI CCI) is a composite index compiled from a seven-questions survey that runs monthly via our consumer polls in the countries covered. The data output is based on fresh, randomly selected representative sample of city dwellers aged 18-64.
Released the first week of every month, the KASI Consumer Confidence Index (KASI CCI) provides a focused view on consumer perceptions in seven African urban centers (Ghana, Nigeria, Kenya, South Africa, Cameroon, Ivory Coast, Tanzania) where most spending in the continent is concentrated. The survey provides a simple measure of consumers’ optimism about their economic prospects in the near term and attitude towards making major purchasing decisions.
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