Consumer confidence has increased slightly this month, although inflation is still high and the outlook for purchasing power is bleak. Statistics Netherlands noted that people are less pessimistic about the economy as a whole than they were a month ago. The statistics office also notes a small improvement in willingness to buy.
The indicator used by Statistics Netherlands to measure consumer confidence reached minus 49 in January, where it was minus 52 a month earlier. This is the third consecutive month that there has been a slight improvement. However, consumer confidence is still exceptionally low and well below the 20-year average of minus 9.
Confidence reached an all-time high in January 2000. Then the indicator was at plus 36. In September and October 2022, the lowest level ever was reached at minus 59. Dutch statistics started measuring it in 1986.
Less pessimistic
In the latest survey, consumers are particularly less pessimistic about the economy for the next twelve months. The assessment of the economy over the past twelve months has been the same as in December. The same was true for assessing one’s financial situation. Consumers also found the time to make big purchases like cars, furniture or appliances slightly less unfavorable in January than in December.
“Consumers are less pessimistic about the next twelve months than they have been over the last twelve months,” explains BNR’s in-house economist, Han de Jong. But according to De Jong, the judgment over the last twelve months has been extremely negative. “Not surprising given inflation and uncertainty.” Yet he still doesn’t want to use the word ‘optimistic’. “At least we’re less pessimistic.”
Reduction of uncertainty
According to De Jong, the decline in consumer confidence “roughly coincides with the peak in inflation”. “And inflation is closely related to energy prices. Inflation uncertainty now appears to have eased somewhat as inflation is falling again, and this is also because energy prices have fallen. The reduced uncertainty is good for consumer confidence.’
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
