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Published: 27 June 2011

Consumer confidence deteriorated in June

Consumer confidence in the economy has deteriorated further. In June, the consumer confidence indicator stood at 11.4, while in May it was 15.4 and in April 17.8. At the same time, confidence in the economy was weaker in June than one year earlier (18.7) and below the long-term average (13.3). The data are based on Statistics Finland’s Consumer Survey, for which 1,375 people resident in Finland were interviewed between 1 and 16 June.

Consumer confidence indicator

In June, confidence in all four components of the consumer confidence indicator deteriorated from the previous month, as well as from twelve months back. Consumers' views concerning their own economy, as well as Finland's economy and the development of unemployment were in June clearly more pessimistic than the long-term average. By contrast, although weakened, assessments concerning own saving possibilities still remained bright. In addition, consumers felt less and less threatened by personal unemployment. In June, consumers thought prices would rise fast and considered saving more worthwhile than purchasing of durable goods or raising a loan.

In June, 26 per cent of consumers believed that Finland’s economic situation would improve in the coming twelve months, while more, or 30 per cent, of them thought that the country’s economy would deteriorate. In May, the corresponding proportions were 32 and 24 per cent and in last year's June optimistic 47 and 17 per cent. In all, 25 per cent of consumers believed in June that their own economy would improve while 17 per cent of them feared it would worsen over the year. One month earlier, the corresponding proportions were 29 and 13 per cent, and one year earlier 27 and 9 per cent.

Consumers' expectations concerning their own and Finland's economy in 12 months' time

In June, 29 per cent of consumers expected unemployment to decrease in Finland over the next year, while slightly more, or 30 per cent, of them believed it would increase. The corresponding proportions were 34 and 30 per cent in May, and 30 and 30 per cent one year ago.

In June, 19 per cent of employed persons believed that their personal threat of unemployment had lessened over the past few months, whereas 13 per cent thought it had grown. These proportions were 17 and 12 per cent in May and gloomy 12 and 18 per cent one year ago. In June, 45 per cent of employed persons thought the threat of unemployment had remained unchanged and 23 per cent felt that they were not threatened by unemployment at all.

Consumers predicted in June that consumer prices would go up by 3.4 per cent over the next 12 months. In June last year, the predicted inflation rate was 2.2 per cent, and its long-term average is 2.1 per cent.

In June, 61 per cent of consumers considered saving worthwhile. Sixty-seven per cent of households had been able to lay aside some money and 78 per cent believed they would be able to do so during the next 12 months.

In June, 53 per cent of consumers regarded the time good for raising a loan. One year ago, the corresponding proportion was 69 per cent. However, as many households as before, or 14 per cent of them, were planning in June to take out a loan within one year.

In June, 40 per cent of consumers thought the time was favourable for buying durable goods. One month earlier the respective proportion was 38 per cent and one year earlier 52 per cent. In June, many households were planning to spend money on, for instance, travel or purchases of domestic appliances during the next six months. Fifteen per cent of households were fairly or very certain to buy a car and slightly fewer households than before, or six per cent them, to buy a dwelling during the next 12 months. In last year’s June, the corresponding proportions were 16 and 8 per cent.

The population of the Consumer Survey comprises approximately 4.1 million persons and 2.5 million households in Finland. The size of the sample of the Consumer Survey is 2,200 persons monthly. In June, the non-response rate of the Survey was 37.5 per cent. The non-response rate includes those who refused from the survey or were otherwise prevented from participating as well as those who could not be contacted.

Consumers' views of the economy

	Average 10/1995-	Max. 10/1995-	Min. 10/1995-	06/2010	05/2011	06/2011	Outlook
A1 Consumer confidence indicator, CCI = (B2+B4+B7+D2)/4	13,3	22,9	-6,5	18,7	15,4	11,4	-
B2 Own economy in 12 months' time (balance)	9,1	14,1	2,3	10,0	10,0	5,2	--
D2 Household's saving possibilities in the next 12 months (balance)	37,5	52,2	10,9	50,5	46,5	44,8	+
B4 Finland's economy in 12 months' time (balance)	5,3	25,3	-27,1	15,1	3,7	-2,9	-
B7 Unemployment in Finland in 12 months' time (balance)	1,5	27,6	-51,1	-1,0	1,6	-1,3	+/-
B8 Own threat of unemployment now (balance)	1,0	7,6	-18,8	-1,7	6,2	7,1	+
B6 Inflation in 12 months' time (per cent)	2,1	4,6	0,6	2,2	3,4	3,4
C1 Favourability of time for buying durable goods (balance)	21,1	41,8	-14,2	29,7	8,8	10,2	--
C2 Favourability of time for saving (balance)	11,3	36,8	-19,6	18,4	18,0	14,2	+/-
C3 Favourability of time for raising a loan (balance)	18,3	42,0	-47,1	26,2	6,7	3,4	-

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 – the higher (positive) balance figure, the brighter the view on the economy.

Explanations for Outlook column: ++ Outlook is very good, + Outlook is good, +/- Outlook is neutral, - Outlook is poor, -- Outlook is very poor. Deviation of balance from average has been compared to standard deviation.

The (seasonally adjusted) Consumer Survey results for all EU countries will be later released on the European Commission website: European Commission, DG ECFIN, Business and Consumer Survey Results; http://ec.europa.eu/economy_finance/db_indicators/surveys/index_en.htm

Source: Consumer Survey 2011, June. Statistics Finland

Inquiries: Pertti Kangassalo (09) 1734 3598, kuluttaja.barometri@stat.fi

Director in charge: Ari Tyrkkö

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• 1. Method of the Consumer Survey (27.6.2011)

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Appendix tables

• Appendix table 1. Consumers' views and intentions (27.6.2011)

Figures

• Appendix figure 1. Consumer confidence indicator (CCI) (27.6.2011)
• Appendix figure 2. Micro and macro indicators (27.6.2011)
• Appendix figure 3. Own economy (27.6.2011)
• Appendix figure 4. Finland's economy (27.6.2011)
• Appendix figure 5. Inflation (27.6.2011)
• Appendix figure 6. Unemployment (27.6.2011)
• Appendix figure 7. Favourability of time for (27.6.2011)
• Appendix figure 8. Household's financial situation (27.6.2011)
• Appendix figure 9. Intentions to raise a loan, next 12 months (27.6.2011)
• Appendix figure10. Spending on durable goods, next 12 months vs last 12 months (27.6.2011)
• Appendix figure 11. Intentions to buy, next 12 months (27.6.2011)

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Updated 27.6.2011