Filipino consumers are more upbeat about their prospects for the upcoming year or the next 12 months despite having weaker sentiments on their earning and spending outlook for the third quarter, the latest Bangko Sentral ng Pilipinas (BSP) Consumer Expectations Survey (CES) showed on Friday, June 28.
Data from BSP’s latest consumer survey showed that the consumer sentiment in the Philippines was more pessimistic for the second quarter 2024 as the overall confidence index (CI) became more negative at -20.5 percent from -10.9 percent in the first quarter of 2024.
For the third quarter of this year, the CI turned negative at -0.4 percent from 2.7 percent in Q1 2024. However, the consumer sentiment for the next 12 months remained optimistic as the CI was little changed at 13.5 percent from 13.4 percent in Q1 2024.
BSP Officer-in-charge for the Monetary Policy Sub-Sector Redentor Paolo Alegre Jr. said in a briefing that consumer confidence weakened in Q2 due to concerns about lower-income, rising prices, expenses, and job scarcity concerns.
“Meanwhile, consumer outlook turns pessimistic for the third quarter but remains optimistic for the next 12 months,” Alegre said.
Consumer sentiment became more negative across all component indicators and income categories. Economic status, household income, and financial status are examples of component indicators.
In addition to the reasons Alegre cited, the BSP data showed that customers were concerned about the efficacy of government policies and initiatives regarding labor and employment, public transportation and traffic, inflation control, and financial support.
The CES also noted that consumers are more hesitant about buying big-ticket items in the second quarter with a CI that is more negative at -64.5 percent from -62.6 percent in the previous survey.
On the other hand, the consumer sentiment on buying big-ticket items remained pessimistic over the next 12 months as the CI was at -70.7 percent versus -69.8 percent previously.
In the previous survey, 6.3 percent of respondents said they may purchase or acquire real property during the following 12 months; this number dropped to 4.7 percent.
According to the BSP, fewer households than in the first quarter intended to purchase duplexes, residential lots, and single-attached homes in the second quarter.
The percentage of households having savings fell from 33.5 percent in the survey conducted in the first quarter to 31.4 percent now.
Households believe that while the BSP has maintained the interest rate at 6.5 percent, it will rise more quickly in the second quarter and more slowly in the third and the following year.
The same is true for inflation, where they anticipate a slight increase in inflation in the third quarter and during the following twelve months. Consumers estimate that inflation would average 5.5 percent over the next 12 months, significantly higher than the BSP’s goal range of two to four percent. The average rate of inflation as of the end of May was 3.5%. (TCSP)
