Consumer confidence fell into negative territory again in July, below the average level of last year.
Fedesarrollo reported yesterday that the Consumer Confidence Index (CCI) stood at -10.4%, which means a reduction of 13.3 percentage points compared to the previous month.
(June consumer confidence entered positive territory).
The report shows that the decrease is due to a decrease in the two variables that are taken into account for the measurement. Firstly, it was introducedn decrease of 13.2 pps in the Consumer Expectations Index. And, on the other hand, the Economic Conditions Index fell by 13.3 pps.
The ICC went down in all socioeconomic sectors, which shows less confidence compared to the previous month. By cities, the drop was also noted, except in Barranquilla, he added.
“When comparing the results of the third quarter of 2022 with those of the second quarter, the assessment of consumers regarding the situation of their homes fell by 3.2 pps and the assessment of the situation of their country increased by 4.7 pps . For its part, the willingness of consumers to buy durable goods in July was -44.7%, a result that represents a drop of 3.5 pps relative to the balance registered in the second quarter of 2022”, explained Fedesarrollo.
The disposition to buying furniture and household appliances in July fell 7.9 pps compared to the previous month. By cities, this indicator fell in the five cities analyzed compared to what was observed in the previous month. The mood to buy a house fell 17.1 pps compared to last month. By cities, this indicator had a contraction in four of the five cities analyzed compared to June 2022.
(Davivienda Confidence Indicator fell in April).
The Directorate of Economic, Sectoral and Market Research of Bancolombia commented that “The perception of the current situation of households was the heading of the conditions sub-indicator that fell the most in the month, reflecting the impact of high inflation, high exchange rate and as a sign that the labor market would have continued with much slow on the margin”.
Regarding expectations, the item that weakened the most was the vision of the future of the country’s economy for the next 12 months. Evidence of this concern is the deterioration in willingness to purchase goods, with strength in the housing segment.
“These results put downward pressure on the behavior of private demand in the country in the second half of the year.”
The media noise that the tax reform process by Congress will imply will put more pressure on consumer confidence in the coming months.
BRIEFCASE
