Consumer confidence rebounds

CONSUMER CONFIDENCE            SPEND 

Asia - Many consumers in Asia seem to think they're out of the recession, but remain skittish about actually parting with their money, found a new study.

Key markets in Asia are posting double-digit increases in consumer sentiment, the latest Nielsen Global Consumer Confidence Index said.

The survey, conducted between 28 September and 16 October 2009 saw Hong Kong posting a 14 point increase from 79 in the third quarter to 93, the largest consumer confidence increase. It was followed by South Korea with a 13 point increase.

Globally, the index registered a nine-point increase in confidence from 77 points in April to 86 this month. India, Indonesia and Norway continued to top the global rankings for the most confident nations, while the most pessimistic were Latvia and Japan.  

"A nine-point surge in consumer confidence signifies a welcome return to positive territory," said James Russo, VP of global consumer insights at The Nielsen Company. "It really demonstrates that in the last six months, a majority of consumer sentiment across the global has shifted gears from recession to recovery - the tide has turned."

Consumer confidence in China saw a six point increase while in India the index rose eight points. The increase in China was driven by strong improvements in local job prospects and personal income across the country. Nearly six in 10 Chinese consumers described local job prospects as good or excellent in the next 12 months, a 14% increase from the previous quarter.

In spite of this, consumers in China have been found to be cautious when parting with their money, the study found. "Consumers in China are still hesitant to go out and spend money, yet the results indicate that there is a willingness to spend on new products," said Mitch Barns, greater China president at Nielsen. "Companies that focus on innovation and introducing new products to the market will be the ones to drive consumption throughout China."

The study also found some 66% of global consumers believing their economy is still in recession, compared to 71% in April. Many consumers in Asia in particular, believe their economies are already out of the woods. Amongst the Chinese, 87% said their nation is out of recession, while over 60% of citizens in Hong Kong and Australia feel the same way.

"In the previous survey conducted in July, we saw that consumers were beginning to feel that the economy had bottomed out and was on the road to recovery. In the third quarter we see an extension of this optimism. Consumers are gradually feeling more comfortable with their situation and feel that the economy is moving in the right direction," said Barns.

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