Home > Statistics > Consumer Confidence > 2007 > July > Consumers strongly confident in the economy

Published: 27 July 2007

Consumers strongly confident in the economy

Consumers' confidence in the economy remained strong in July, albeit slightly less strong than in June. The consumer confidence indicator stood at 18.5 in July, while it was 20.4 in June. At the same time, consumers' confidence in the economy was clearly stronger when compared with one year ago and with the long-term average. The data are based on Statistics Finland's Consumer Survey, for which 1,538 people resident in Finland were interviewed between 2 and 20 July.

Of the four components of the consumer confidence indicator, expectations on households' saving possibilities weakened slightly in July from the previous month. Views on saving possibilities are, however, still excellent. Other components of the consumer confidence indicator remained essentially unchanged in July. Consumers' expectations on Finland's economy remained subdued. By contrast, confidence in the decrease of unemployment was strong, similarly as in June.

Consumer views on the economic and financial conditions in Finland in July 2007, balances*

	Average 10/95-7/07	Max. 10/95-7/07	Min. 10/95-7/07	July 2006	June 2007	July 2007	Situation***
Consumer confidence indicator (CCI)	13.8	21.8	3.5	14.4	20.4	18.5	++
CCI components:
Own economic situation in 12 months' time	9.5	14.1	2.3	9.1	12.2	11.4	+
Households' saving possibilities in the next 12 months	34.1	51.8	10.9	45.3	51.8	45.1	++
Finland's economic situation in 12 months time	6.3	21.7	- 14.0	0.2	3.6	2.6	-
Finland's unemployment situation in 12 months time	5.5	27.6	- 22.7	3.1	14.1	14.8	+
Others:
Inflation in 12 months' time, per cent	2.0	3.1	0.7	2.4	2.5	2.6
Own threat of unemployment at present**	4.0	6.6	0.8	4.7	5.1	6.1	++
Financial situation of household at present	25.7	35.1	14.7	30.8	34.0	32.5	++
Favourable time to make major purchases at present	21.0	37.7	- 2.1	29.0	14.6	22.3	+
Favourable time to save at present	8.4	33.7	- 19.6	22.3	33.1	33.7	++
Favourable time to raise a loan at present	22.2	42.0	- 13.5	24.8	3.6	3.7	-
* 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. A positive balance figure denotes an optimistic and a negative balance figure a pessimistic view on the economy. ** Own threat of unemployment has only been asked since March 2004. *** ++ Situation is very good, + Situation is good, - Situation is bad, - - Situation is very bad.

In July, 25 per cent of consumers believed that Finland's economic situation would improve in the coming twelve months, while 19 per cent of them thought that the country's economy would deteriorate. In all, 30 per cent of consumers believed in July that their own economy would improve and only 11 per cent of them feared it would worsen over the year.

Altogether 48 per cent of consumers believed in July that unemployment would decrease over the year, while 19 per cent of them thought it would increase. One year ago, the corresponding proportions were 37 and 30 per cent. Seventeen per cent of employed persons reckoned in July that their personal threat of unemployment had lessened over the past few months, while 10 per cent thought it had grown.

Consumers predicted in July that consumer prices would go up by 2.6 per cent over the next 12 months. The long-term predicted average inflation rate is 2.0 per cent.

Saving was considered worthwhile by 78 per cent of consumers in July. Twelve months earlier the corresponding percentage was 68. Sixty-five per cent of households had been able to lay aside some money, and 77 per cent believed they would be able to do so during the next year. Households mostly save for a rainy day, for paying off debts or for a holiday trip, and the second most popular investment targets, after bank accounts, are various kinds of funds.

In July, 53 per cent of consumers regarded the time favourable for raising a loan. One year ago the respective proportion was 71 per cent. Slightly fewer households than before, or 11 per cent of them, were planning to raise a loan within one year.

In July, 47 per cent of consumers thought the time was favourable for buying durable goods. Many households intended to spend money on, for instance, home furnishings and entertainment electronics. Thirty-three per cent of households considered purchasing a digital set-top box during the autumn. In the next twelve months, 17 per cent of households were fairly or very certain to buy a car and 8 per cent a dwelling.

Consumer confidence indicator 10/1995-7/2007

Consumers' expectations concerning their own and Finland's economy in 12 months' time
10/1995-7/2007

Consumer confidence indicator in EU member states, June 2007
Deviation of indicator from country average 10/1995 - 6/2007*

*Calculated from seasonally adjusted series.
Source: European Commission, DG ECFIN, Business and Consumer Survey Results, June 2007
http://europa.eu.int/comm/economy_finance/indicators/businessandconsumersurveys_en.htm

Source: Consumer Survey 2007, July. 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 27.7.2007