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Published: 27 August 2013

Consumer confidence unchanged in August

Consumers’ confidence in the economy is still weak. The consumer confidence indicator stood at 5.0 in August, which was unchanged from July. In June, the consumer confidence indicator was 8.1. In August, confidence in the economy was higher than one year ago (0.5) but clearly below the long-term average (12.3). The data are based on Statistics Finland’s Consumer Survey, for which 1,450 people resident in Finland were interviewed between 1 and 19 August.

Consumer confidence indicator (CCI)

None of the four components of the consumer confidence indicator changed considerably in August compared to the previous month. Consumers’ expectations of Finland’s economic situation and, in particular, on the development of unemployment were still pessimistic in August. Consumers' assessments about their own economic situation also remained cautious. By contrast, consumers still considered their own saving possibilities as good.

Consumers did not regard saving, raising a loan or purchasing durable goods very worthwhile in August. There were no changes in the employed consumers' feelings about their personal threat of unemployment in August.

Consumers' own and Finland's economy

In August, 25 per cent of consumers believed that Finland’s economic situation would improve in the coming twelve months, while more, or 35 per cent, of them thought that the country’s economy would deteriorate. In last year’s August the corresponding proportions were 15 and 46 per cent.

In all, 23 per cent of consumers believed in August that their own economy would improve and 14 per cent of them feared it would worsen over the year. One year ago the respective proportions were 20 and 17 per cent.

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

Unemployment and inflation

Altogether 12 per cent of consumers thought in August that unemployment would decrease in Finland over the year, while 61 per cent of them believed it would increase.

In August, 11 per cent of employed persons believed that their personal threat of unemployment had lessened over the past few months, whereas 20 per cent thought it had grown. Two-fifths (40%) of employed persons thought the threat of unemployment had remained unchanged and one-quarter (28%) felt that they were not threatened by unemployment at all.

Consumers predicted in August that consumer prices would go up by 2.6 per cent over the next 12 months. One year earlier the predicted inflation rate was 3.4 per cent, and its long-term average is 2.3 per cent.

Buying of durable goods

Only 37 per cent of consumers thought in August that the time was favourable for buying durable goods. Despite moderate consumption intentions, purchases of domestic appliances and hobby equipment held some attraction. Sixteen per cent of households were fairly or very certain to buy a car and seven per cent a dwelling during the next 12 months. In August, 19 per cent of households were planning to make renovations to their dwelling.

Saving and taking out a loan

Altogether 55 per cent of consumers considered saving worthwhile in August. In all, 65 per cent of households had been able to lay aside some money and 80 per cent believed they would be able to do so during the next 12 months.

In August, 52 per cent of consumers regarded the time good for raising a loan. The respective proportion was 58 per cent in July and 62 per cent one year ago. In August, 11 per cent of households were planning to take out a loan within one year.

Consumers' views of the economy

	Average 10/1995-	Max. 10/1995-	Min. 10/1995-	08/2012	07/2013	08/2013	Outlook
A1 Consumer confidence indicator, CCI = (B2+B4+B7+D2)/4	12,3	22,9	-6,5	0,5	5,0	5,0	--
B2 Own economy in 12 months' time (balance)	8,6	14,1	2,3	2,6	6,2	5,7	--
B4 Finland's economy in 12 months' time (balance)	3,6	25,3	-27,1	-18,1	-5,0	-7,0	-
B6 Inflation in 12 months' time (per cent)	2,3	4,6	0,6	3,4	2,9	2,6
B7 Unemployment in Finland in 12 months' time (balance)	-1,4	27,6	-51,1	-28,2	-26,5	-27,4	--
B8 Own threat of unemployment now (balance)	0,2	7,6	-18,8	-2,7	-4,9	-5,0	-
C1 Favourability of time for purchasing durables (balance)	19,2	41,8	-14,2	11,4	4,1	3,7	--
C2 Favourability of time for saving (balance)	11,4	36,8	-19,6	13,2	2,7	7,2	-
C3 Favourability of time for raising a loan (balance)	17,3	42,0	-47,1	18,0	11,7	6,7	-
D2 Household's saving possibilities in the next 12 months (balance)	38,5	52,2	10,9	45,7	45,3	48,7	+

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 Survey

The population of the Consumer Survey comprises 4.4 million persons aged 15 to 84 and their 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 monthly sample of the Survey is 2,350 persons (previously 2,200 persons).

In August, the non-response rate of the Survey was 38.3 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 good one unit starting from January 2012. This has primarily been caused by a drop in the balance figure of one component, namely own household's saving possibilities. The extension of the population has also somewhat affected the results on owning various home technology.

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 2013, August. Statistics Finland

Inquiries: Pertti Kangassalo 09 1734 3598, Tara Junes 09 1734 3503, consumer.survey@stat.fi

Director in charge: Riitta Harala

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• 1. Method of the Consumer Survey (27.8.2013)

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Appendix tables

• Appendix table 1. Consumers' views and intentions (27.8.2013)

Figures

• Appendix figure 1. Consumer confidence indicator (CCI) (27.8.2013)
• Appendix figure 2. Micro and macro indicators (27.8.2013)
• Appendix figure 3. Own economy (27.8.2013)
• Appendix figure 4. Finland's economy (27.8.2013)
• Appendix figure 5. Inflation (27.8.2013)
• Appendix figure 6. Unemployment (27.8.2013)
• Appendix figure 7. Favourability of time for (27.8.2013)
• Appendix figure 8. Household's financial situation (27.8.2013)
• Appendix figure 9. Household's intentions to raise a loan, next 12 months (27.8.2013)
• Appendix figure10. Spending on durables, next 12 months vs last 12 months (27.8.2013)
• Appendix figure 11. Household's intentions to buy, next 12 months (27.8.2013)

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Updated 27.8.2013