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Published: 27 August 2012

Consumers’ confidence in the economy unchanged in August

Consumer confidence indicator still stood at zero (0.5) in August, that is, at the same level as in July (0.1). Confidence in the economy was clearly weaker than in August one year ago and when compared with the long-term average. The data are based on Statistics Finland’s Consumer Survey, for which 1,437 people resident in Finland were interviewed between 1 and 17 August.

Consumer confidence indicator (CCI)

In August, confidence changed only fractionally from the previous month in all four components of the consumer confidence indicator. Caution increased both about consumers' own economy and about their households’ saving possibilities. Consumers' views on the development of their own economy have been lower only in April 1996 and in October 1995. Consumers' estimates about the future of Finland's economy and development of unemployment continued to be fairly gloomy.

In August, the threat of unemployment felt by employed persons remained nearly unchanged compared with July. Consumers still regarded the time fairly good for saving and raising a loan.

Consumers' own and Finland's economy

In August, 15 per cent of consumers believed that Finland’s economic situation would improve in the coming twelve months, while 46 per cent of them thought that the country’s economy would deteriorate. Twelve months previously, the corresponding proportions were 18 and 45 per cent.

Confidence in the improvement of one's own economy has weakened compared with last year's August. Now only one fifth believed that their own economy would improve, while one year ago this was so for around one quarter (24%). One-sixth (17%) feared that their own economy would weaken. One year previously, the corresponding proportion was 15 per cent.

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

Unemployment and inflation

Finnish residents' views about the growing of unemployment have increased compared with August last year. Three out of five consumers (60%) thought in August that unemployment would increase over the year, and one tenth of them believed it would decrease. Twelve months earlier the corresponding proportions were 42 and 17 per cent.

The personal threat of unemployment experienced by employed persons has increased from one year back. One sixth (17%) of employed persons reckoned in August that their personal threat of unemployment had grown over the past few months whereas one tenth thought it had lessened. Twelve months earlier the corresponding proportions were 14 and 13 per cent. One half 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 August that consumer prices would go up by 3.4 per cent over the next 12 months. One month ago, the respective predicted inflation rate was slightly more moderate, 2.8 per cent and one year ago 3.1 per cent.

Taking out a loan and saving

In August, 62 per cent of consumers regarded the time good for taking out a loan. Twelve months ago, the respective proportion was 45 per cent. In August, 13 per cent of households were planning to take out a loan within one year.

Saving was considered worthwhile by three fifths (60%) of consumers. Two thirds 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.

Consumers' views of the economy

	Average 10/1995-	Max. 10/1995-	Min. 10/1995-	08/2011	07/2012	08/2012	Outlook
A1 Consumer confidence indicator, CCI = (B2+B4+B7+D2)/4	12,8	22,9	-6,5	5,1	0,1	0,5	--
B2 Own economy in 12 months' time (balance)	8,8	14,1	2,3	5,8	3,6	2,6	--
B4 Finland's economy in 12 months' time (balance)	4,2	25,3	-27,1	-16,5	-18,7	-18,1	--
B6 Inflation in 12 months' time (per cent)	2,2	4,6	0,6	3,1	2,8	3,4
B7 Unemployment in Finland in 12 months' time (balance)	-0,0	27,6	-51,1	-13,6	-30,8	-28,2	--
B8 Own threat of unemployment now (balance)	0,8	7,6	-18,8	1,6	-4,1	-2,7	-
C1 Favourability of time for purchasing durables (balance)	20,1	41,8	-14,2	8,4	7,6	11,4	-
C2 Favourability of time for saving (balance)	11,7	36,8	-19,6	20,6	12,0	13,2	+/-
C3 Favourability of time for raising a loan (balance)	17,5	42,0	-47,1	-4,4	16,3	18,0	+/-
D2 Household's saving possibilities in the next 12 months (balance)	38,1	52,2	10,9	44,7	46,5	45,7	+

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 population and sample of the Consumer Survey

The population of the Consumer Survey comprises 4.4 million persons aged 15 to 84 and 2.6 million households in Finland. The population was extended to persons aged 75 to 84 starting from January 2012. The gross size of the Survey in August was 2,340 persons.

In August, the non-response rate of the Survey was 38.6 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.

The extension of the population, that is, responses from persons aged 75 to 84, is estimated to have weakened the value of the consumer confidence indicator by one unit starting from January 2012.

EU results

The (seasonally adjusted) Consumer Survey results for all EU countries are 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 2012, August. Statistics Finland

Inquiries: Tara Junes 09 1734 3503, kuluttaja.barometri@stat.fi

Director in charge: Riitta Harala

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• 1. Method of the Consumer Survey (27.8.2012)

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Appendix tables

• Appendix table 1. Consumers' views and intentions (27.8.2012)

Figures

• Appendix figure 1. Consumer confidence indicator (CCI) (27.8.2012)
• Appendix figure 2. Micro and macro indicators (27.8.2012)
• Appendix figure 3. Own economy (27.8.2012)
• Appendix figure 4. Finland's economy (27.8.2012)
• Appendix figure 5. Inflation (27.8.2012)
• Appendix figure 6. Unemployment (27.8.2012)
• Appendix figure 7. Favourability of time for (27.8.2012)
• Appendix figure 8. Household's financial situation (27.8.2012)
• Appendix figure 9. Household's intentions to raise a loan, next 12 months (27.8.2012)
• Appendix figure10. Spending on durables, next 12 months vs last 12 months (27.8.2012)
• Appendix figure 11. Household's intentions to buy, next 12 months (27.8.2012)

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Updated 27.8.2012