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Published: 27 December 2006

Consumers stay confident in December

Consumers' confidence in the economy remained strong in December. The consumer confidence indicator stood at 18.2 in December, whereas it was 17.9 in November and 16.1 twelve months ago. At the same time, confidence in the economy was clearly stronger than the long-term average. The data are based on Statistics Finland's Consumer Survey, for which 1,517 people resident in Finland were interviewed between 1 and 18 December.

Of the four components of the consumer confidence indicator, consumers' confidence in December weakened slightly from the previous month only with regard to their own economy. Compared to twelve months ago, expectations concerning Finland's economy and the development of unemployment grew clearly brighter. Consumers' were very confident about their own possibilities to make savings and that saving was worthwhile. In December, households had more intentions to purchase digital TV converters and other entertainment electronics than ever before.

Consumer views on the economic and financial conditions in Finland in December 2006

	December 2006 balance figure	November 2006 balance figure	December 2005 balance figure	Average 10/95-12/06
Consumer confidence indicator (CCI)	18.2	17.9	16.1	13.6
CCI components:
Own economic situation in 12 months' time	10.9	12.9	11.3	9.3
Household's saving possibilities in the next 12 months	49.4	47.5	48.2	33.4
General economic situation in Finland in 12 months' time	4.3	3.3	1.4	6.5
Unemployment in Finland in 12 months' time	8.0	7.8	3.6	5.3
Others:
Inflation in 12 months' time. %	2.5	2.3	2.3	2.0
Personal threat of unemployment at present	6.1	4.2	4.2	..
Financial situation of household at present	33.0	30.9	32.9	25.4
Favourable time to make major purchases at present	20.4	20.9	14.4	21.0
Favourable time to save at present	28.7	27.3	15.5	7.2
Favourable time to raise a loan at present	17.0	17.0	27.3	23.0
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 December, 25 per cent of consumers believed that Finland's economic situation would improve during the next 12 months, while 17 per cent of them thought that the country's economy would deteriorate. Twelve months earlier, the respective proportions were 24 and 20 per cent. In all, 29 per cent of consumers believed in December that their own economy would improve and 10 per cent of them feared it would worsen over the year. The respective proportions in November were 31 and 9 per cent.

Altogether 24 per cent of consumers thought in December that unemployment would increase over the year, while 42 per cent believed it would decrease. Twelve months earlier, the corresponding proportions were 28 and 37 per cent. In December, 9 per cent of employed persons reckoned that their personal threat of unemployment had grown over the past few months, whereas 15 per cent thought it had lessened.

Consumers predicted in December that consumer prices would go up by 2.5 per cent over the next 12 months. The respective predicted inflation rate was 2.3 per cent in November and one year ago.

As many as 73 per cent of consumers considered saving worthwhile in December. Twelve months earlier the corresponding percentage was 63. Sixty-five per cent of households had been able to lay aside some money, and 81 per cent believed they would be able to do so during the next 12 months. In December, 64 per cent of consumers regarded the time good for raising a loan. One year ago the respective percentage was 71 per cent. In December, 13 per cent of households were planning to take out a loan within one year.

In December, 44 per cent of consumers thought the time was favourable for buying durable goods. A record proportion of 56 per cent of households intended to purchase entertainment electronics in the coming six months. Forty per cent of households considered purchasing a digital set-top box by spring. Sixteen per cent of households were fairly or very certain to buy a car and 7 per cent a dwelling during the next 12 months.

Consumer confidence indicator 10/1995-12/2006

Consumers' expectations concerning their own and Finland's economy in 12 months' time 10/1995-12/2006

Consumer confidence indicator in EU Member States, November 2006
Deviation of indicator from country average 10/1995 - 11/2006*

*Calculated from seasonally adjusted series. Data for France are indicative due to break in time series.
Averages for a shorter time period: Malta 11/2002-, Luxembourg 1/2002-, Cyprus, Lithuania and Poland 1/2001-, Slovakia 4/1999-.
Source: European Commission, DG ECFIN, Business and Consumer Survey Results, November 2006
http://europa.eu.int/comm/economy_finance/indicators/businessandconsumersurveys_en.htm

Source: Consumer Survey 2006, December. Statistics Finland

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

Director in charge: Mr Ari Tyrkkö

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Last updated 27.12.2006