Home > Statistics > Consumer Confidence > 2007 > September > Consumers' view of Finland's economy has deteriorated

Published: 27 September 2007

Consumers' view of Finland's economy has deteriorated

Consumers' confidence in the economy remained strong in September. The consumer confidence indicator stood at 18.5 in September, having been 20.3 in August and 18.5 in July. When compared with one year ago and with the long-term average, confidence in the economy was stronger. The data are based on Statistics Finland's Consumer Survey, for which 1,573 people resident in Finland were interviewed between 3 and 19 September.

Of the four components of the consumer confidence indicator, expectations of Finland's economy weakened in September from the month before and were the gloomiest in the past few years. The balance figure of consumers' own economic situation also fell slightly, but remained above its long-term average. Consumers' views of unemployment and especially of saving remained bright, whereas estimates on the favourability of raising a loan continued to weaken. In addition, the favourability of making major purchases was estimated to have lessened in September and inflation was estimated to pick up in the future.

Consumer views on the economic and financial conditions in Finland in September 2007, balances*

	Average 10/95-9/07	Max. 10/95-9/07	Min. 10/95-9/07	September 2006	August 2007	September 2007	Situation***
Consumer confidence indicator (CCI)	13.9	21.8	3.5	16.1	20.3	18.5	++
CCI components:
Own economic situation in 12 months' time	9.5	14.1	2.3	10.2	11.7	10.2	+
Households' saving possibilities in the next 12 months	34.4	52.0	10.9	44.6	52.0	51.4	++
Finland's economic situation in 12 months time	6.2	21.7	-14.0	1.2	1.5	-3.5	- -
Finland's unemployment situation in 12 months time	5.6	27.6	-22.7	8.5	16.1	15.7	+
Others:
Inflation in 12 months' time, per cent	2.0	3.1	0.7	2.6	2.8	3.1
Own threat of unemployment at present**	4.1	7.2	0.8	5.6	7.2	5.3	+
Financial situation of household at present	25.8	35.1	14.7	30.4	34.0	32.7	++
Favourable time to make major purchases at present	20.9	37.7	-2.1	23.9	18.3	12.3	- -
Favourable time to save at present	8.7	35.1	-19.6	25.1	35.1	34.5	++
Favourable time to raise a loan at present	21.9	42.0	-13.5	20.5	0.7	-6.2	- -
* 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 the CCI components. 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. ** Own threat of unemployment has only been asked since March 2004. *** ++ Situation is very good, + Situation is good, - Situation is bad, - - Situation is very bad.

In September 21 per cent of consumers believed that Finland's economic situation would improve in the coming twelve months, while 27 per cent of them thought that the country's economy would deteriorate. The respective proportions in August were 25 and 21 per cent. In all, 29 per cent of consumers believed in September that their own economy would improve and only 11 per cent of them feared it would worsen over the year.

Altogether 48 per cent of consumers thought in September that unemployment would decrease over the year, while 16 per cent of them believed it would increase. One year ago, the corresponding proportions were 40 and 22 per cent. Thirteen per cent of employed persons reckoned in September that their personal threat of unemployment had lessened over the past few months, while 9 per cent thought it had grown.

Consumers predicted in September that consumer prices would go up by 3.1 per cent over the next 12 months. Thus the predicted inflation rate was at the record level of April 2001. The long-term predicted average inflation rate is 2.0 per cent.

Similarly to August, saving was considered worthwhile by a record 79 per cent of consumers in September. Twelve months earlier the corresponding percentage was 71. Sixty-eight per cent of households had been able to lay aside some money and as many as 82 per cent believed they would be able to do so during the next 12 months.

In September only 44 per cent of consumers regarded the time good for raising a loan. One year ago the respective proportion was 67 per cent. Nevertheless, 13 per cent of households were planning to raise a loan within one year.

In September, 40 per cent of consumers thought the time was favourable for making major purchases. In August and one year ago the respective proportion was 44 per cent. Many households intended to spend money on, for instance, hobby or sports equipment during the next six months. Intentions of purchasing entertainment electronics had decreased slightly in September, but 29 per cent of households considered purchasing a digital set-top box. In the next twelve months, 17 per cent of households were fairly or very certain to buy a car and 7 per cent a dwelling.

Consumer confidence indicator 10/1995-9/2007

Micro and macro indicators of economy 10/1995-9/2007*

* Micro indicator is the average of three balance figures: own economy and household's saving possibilities in 12 months time,
and household's financial situation at present.
Macro indicator is the average of two balance figures: Finland's economy and unemployment in 12 months time.

Consumer confidence indicator in EU member states, August 2007
Deviation of indicator from country average 10/1995 - 8/2007*

*Calculated from seasonally adjusted series.
Source: European Commission, DG ECFIN, Business and Consumer Survey Results, August 2007
http://europa.eu.int/comm/economy_finance/indicators/businessandconsumersurveys_en.htm

Source: Consumer Survey 2007, September. 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 27.9.2007