Home > Statistics > Consumer Confidence > 2006 > January > Consumers' confidence in the economy fell slightly in January

Published: 27 January 2006

Consumers' confidence in the economy fell slightly in January

Strengthening of consumers' confidence that had started in October halted in January. The consumer confidence indicator stood at 13.7 in January, while in December it was 16.1. The confidence indicator was still on level with its long-term average and higher than one year ago. The data are based on Statistics Finland's Consumer Survey for which 1,524 persons resident in Finland were interviewed between 2 and 19 January.

Of the four components of the confidence indicator only expectation of Finland's economy improved in January compared with December. Estimates of one's own economy and saving possibilities still remained bright, however. Views on unemployment turned again slightly pessimistic. Consumers considered the time very favourable for buying durable goods in January.

Consumer views on the economic and financial conditions in Finland in January 2006

		January 2006 balance figure		December 2005 balance figure		January 2005 balance figure		Average 10/95-1/06
Consumer confidence indicator		13.7		16.1		12.3		13.5
Own economic situation in 12 months' time		10.1		11.3		10.9		9.2
Household's saving possibilities in the next 12 months		41.7		48.2		40.2		32.2
General economic situation in Finland in 12 months' time		4.0		1.4		5.1		6.9
Unemployment in Finland in 12 months' time		-1.0		3.6		-6.9		5.7
Inflation in 12 months' time, %		2.2		2.3		1.9		1.9
Personal threat of unemployment at present		3.8		4.2		4.8		..
Financial situation of household at present		31.4		32.9		28.6		24.8
Favourable time to make major purchases at present		31.1		14.4		34.5		20.7
Favourable time to save at present		12.7		15.5		15.2		5.7
Favourable time to raise a loan at present		26.0		27.3		30.2		23.1
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 four questions concerning the next 12 months: own and Finland's economy, unemployment and household's saving possibilities. 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.

In January, 27 per cent of consumers believed that Finland's economic situation would improve in the coming twelve months. Nineteen per cent of consumers thought that the country's economy would deteriorate. The corresponding proportions for December were 24 and 20 per cent. In all, 28 per cent of consumers believed in January that their own economy would improve and only 10 per cent of them feared it would worsen over the year.

Altogether 33 per cent of consumers thought in January that unemployment would increase over the year, and 32 per cent of them believed it would decrease. The corresponding proportions were 28 and 37 per cent in December. Thirteen per cent of employed persons reckoned in January that their personal threat of unemployment had grown over the past few months but slightly more of them, i.e. 15 per cent thought it had lessened.

Consumers predicted in January that consumer prices would go up by 2.2 per cent over the next 12 months. One year ago that inflation expectation was 1.9 per cent.

In January, 51 per cent of consumers thought the time was favourable for buying durable goods. This proportion was 42 per cent in December. Households had plenty of spending intentions on home furnishing and purchasing of leisure or sports equipment, among others. Twenty-one per cent of households were thinking of buying a digital set-top box by next summer. In the next 12 months 19 per cent of households were either fairly or very certain to buy a car and 9 per cent a dwelling. In last year's January 7 per cent of households were contemplating buying a dwelling.

In January 71 per cent of consumers thought the time was good for raising a loan, and 13 per cent of households were planning to do so in the next 12 months. Saving was considered worthwhile by 60 per cent of consumers in January. In all, 64 per cent of households had been able to lay aside some money and 76 per cent believed they would be able to do so during the next 12 months. As many as 26 per cent of households had invested in funds and 24 per cent in insurances.

Consumer confidence indicator 10/1995-1/2006

Consumers' expectations concerning their own and Finland's economy in 12 months' time 10/1995-1/2006

Consumer confidence indicator in EU Member States, December 2005
Deviation of indicator from country average 10/1995-12/2005*

*Calculated from seasonally adjusted series. Malta does not release a consumer survey. Data for France are missing due to break in time series. Averages for a shorter time period: Luxembourg 1/2002 -, Cyprus, Lithuania and Poland: 1/2001 -, Slovakia: 4/1999 -.
Source: European Commission, DG ECFIN, Business and Consumer Survey Results, December 2005. http://europa.eu.int/comm/economy_finance/indicators/businessandconsumersurveys_en.htm

Source: Consumer Survey 2006, January. 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 27.1.2006