BSP says pessimism to run deep among consumers

By Maricel E. Burgonio, Reporter

AMID higher inflation and eroding incomes, pessimism will run deep among consumers for the rest of the year, according to the latest survey of the Bangko Sentral ng Pilipinas (BSP).

In its Consumer Expectation Survey, the BSP said the overall consumer confidence index dropped to -43.8 percent in the second quarter, easing to -26.9 percent in the third quarter and to -20.3 percent in the next 12 months.

Iluminada Sicat, BSP Department of Economic Statistics director, said Filipinos from the middle- and low-income groups will be more affected by unfavorable economic conditions. About 10 percent of the families are supported by overseas Filipino workers (OFWs).

“Current and near term outlook for consumers nationwide dipped in 2008. The negative perception in the economic condition pulled down the overall confidence,” Sicat said.

She said lower consumer demand in the second quarter indicates slower economic expansion for the period.

In the first quarter of the year, the country’s gross domestic product (GDP) grew 5.2 percent, or below market expectations due to higher oil, rice and other commodity prices.

The inflation rate in May hit a 9-year high of 9.6 percent and is expected to accelerate to 11 percent in June before easing in the second half of the year.

In the next 12 months, consumers expect the unemployment rate to increase, interest rates as well as prices of basic goods and services to climb. They however see a steady peso vis-à-vis the dollar.

Filipino consumers spend more on food, fuel, electricity, education, water, and personal and medical care, the survey showed. Consumers also indicated lower demand for consumer durables, motor vehicles and house and lot.

However, Filipinos indicated higher savings in the second quarter with the index at 31.3 percent from the first quarter’s 14 percent.

About 4,839 participated in the survey from the National Capital Region and areas outside NCR.

The bulk of the respondents at 58 percent came from the lower income group with less than P10,000 monthly earnings. Another 34 percent belonged to the middle income group with P10,000 to P20,000 in monthly earnings.(ManilaTimes)

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