Survey | Local consumers’ economic confidence continues to drop

Macau consumers’ overall confidence in spending money grew slightly during the second quarter of this year, as they saw better prospects in commodity prices, living standards, property purchasing and stock investment. However, their overall confidence is still below the general standard, and confidence in the local economy and employment has continued to decline.
According to the latest quarterly survey conducted by the Macau University of Science and Technology (MUST) between June 16 and 25, locals’ overall consumer confidence stood at 85.94 points out of a scale of 200 in Q2, 0.62 percent higher than the previous quarter and 0.73 percent up compared to Q2 of 2014.
Looking at only the first quarter of 2015, the survey recorded a drop in consumer confidence in the local economy and employment for the first time since the 2008 financial crisis. The two indicators continued to drop in Q2, with confidence in local economy and employment down by 3.2 percent and 5.8 percent respectively, to stand at 96.18 and 110.13 points. Compared with one year ago, the confidence sub-index in employment has plunged by 12.86 percent.
Director of MUST’s Institute for Sustainable Development, Chan Lai Kow, explained in a press conference that the declines show that residents have become “relatively pessimistic [compared with] their previous cautiously-optimistic feeling about the city’s economic performance,” and that the downturn has “further weakened their optimistic attitude toward the labor market.”
The professor further explained: “The economic situation in the mainland has changed dramatically in recent days as stocks have slumped. It is difficult to tell how local consumers’ current perceptions and expectations will change.”
Meanwhile, consumer confidence in commodity prices rose by 1.6 percent to 67.6 points, representing a nearly 15-percent surge when compared with the previous year. The sub-index of living standards also achieved a slight rise of 0.7 percent by quarter, continuing to approach the benchmark of 100 points.
“It shows consumers’ pressure caused by inflation has continued to alleviate, and their worries about future inflation have greatly reduced. But on the other hand, it also suggests an approaching risk of deflation,” said the professor.
The survey also revealed a surge in locals’ confidence towards purchasing property –
an increase of 16.8 percent over the previous quarter. Reaching a score of 53.7, the indicator  remained the lowest of the six sub-
indexes, but still represented a substantial increase. “Compared with the same period last year, there has been a 36.3-percent increase, suggesting substantial further relief from the negative sentiment among potential home buyers,” added the professor.
In addition, the survey reflected a clear rise in local consumers’ willingness to invest in the volatile stock market, as their confidence in stock investment rose by 4.2 percent to 91.1 points over the quarter – a significant rise year-on-year of 8.7 percent, according to the report.