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Published: 27 September 2005

Views of consumers cautious in September

Strengthening of consumers' confidence that started in July halted in September. The consumer confidence indicator stood at 10.8 in September, having been 13.6 in August. At the same time the consumer confidence indicator was again below its long-term average. The data are based on Statistics Finland's Consumer Survey for which 1,510 persons resident in Finland were interviewed between 1 and 20 September.

Compared with the previous month, all the four components of the confidence indicator weakened somewhat in September. Views on Finland's economy and unemployment were pessimistic. In contrast, consumers still had faith in their own economy and saving possibilities. Consumers surmised that inflation would accelerate and buying of durable goods was not thought as worthwhile as one month or year ago.

Consumer views on the economic and financial conditions in Finland in September 2005

		September 2005 balance figure		August 2005 balance figure		September 2004 balance figure		Average 10/95-9/05
Consumer confidence indicator		10.8		13.6		12.2		13.5
Own economic situation in 12 months' time		9.3		11.8		12.5		9.1
Household's saving possibilities in the next 12 months		44.1		47.2		47.9		31.8
General economic situation in Finland in 12 months' time		-2.3		2.0		4.4		7.1
Unemployment in Finland in 12 months' time		-7.8		-6.5		-15.8		5.9
Inflation in 12 months' time, %		2.6		2.2		1.8		1.9
Personal threat of unemployment at present		3.3		5.2		4.3		..
Financial situation of household at present		27.8		32.5		30.9		24.6
Favourable time to make major purchases at present		19.6		27.3		25.7		20.7
Favourable time to save at present		12.5		13.9		14.3		5.4
Favourable time to raise a loan at present		33.0		35.3		28.3		22.9
The balance figures are obtained by deducting the weighted proportion of negative answers from that of positive answers. The consumer confidence indicator is the average of the balance figures for four questions concerning the next 12 months: own and Finland's economy, unemployment and household's saving possibilities. The balance figures and the confidence indicator can range between -100 and 100. A positive balance figure denotes an optimistic and a negative balance figure a pessimistic view on the economy.

In September, 25 per cent of consumers believed that Finland's economic situation would improve in the coming twelve months. Slightly more of them, or 28 per cent thought that the country's economy would deteriorate. The respective proportions were 27 and 22 per cent in August and 29 and 20 per cent one year ago. In all, 28 per cent of consumers still believed in September that their own economy would improve and some more than before, or 11 per cent of them feared it would worsen over the year.

Altogether 41 per cent of consumers thought in September that unemployment would increase over the year, and 28 per cent of them believed it would decrease. Twelve per cent of employed persons reckoned that their personal threat of unemployment had grown over the past few months but slightly more of them, i.e. 14 per cent thought it had lessened.

Consumers predicted in September that consumer prices would go up by 2.6 per cent over the next 12 months. The respective expectation was 2.2 per cent in August and 1.8 per cent one year ago.

In September, 44 per cent of consumers thought the time was favourable for buying durable goods. The corresponding proportion was 48 per cent one month and one year previously. Households still had plenty of intentions for home furnishing and for purchasing home electronics. Sixteen per cent of households were either fairly or very certain to buy a car and 8 per cent a dwelling within the next 12 months.

Of consumers, 76 per cent thought the time was good for raising a loan, and 16 per cent of households were planning to do so in the next 12 months. Saving was considered worthwhile by 60 per cent of consumers in September. In all, 61 per cent of households had been able to lay aside some money and 77 per cent believed they would be able to do so during the next 12 months.

Consumer confidence indicator 10/1995-9/2005

Consumers' expectations concerning their own and Finland's economy in 12 months' time 10/1995-9/2005

Latest comparative data on consumer confidence in different EU countries is available on 30 September
from 12 noon onwards at:
http://europa.eu.int/comm/economy_finance/indicators/businessandconsumersurveys_en.htm

Source: Consumer Survey 2005, September. Statistics Finland

Inquiries: Mr Pertti Kangassalo +358 9 1734 3598, kuluttaja.barometri@stat.fi

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Last updated 27.9.2005