Despite high inflation, consumer confidence has been on the rise for five months, according to data from the Central Bureau of Statistics (CBS). However, BNR’s in-house economist Han de Jong also sees a bleaker picture: “If you look at the long-term average, the consumer remains overall pessimistic.”
The CBS consumer index was -39 in March, compared with -44 the previous month. However, the score is now much higher than its lowest score ever in September 2022, when the score was -59. And De Jong also acknowledges the image that consumers are becoming more positive in other places. “When you look at other indicators, like inflation, it’s surprising that the economy has also done less badly for five consecutive months.”
In the latest survey, consumers were less pessimistic about the economy over the past twelve months and about the economy over the next twelve months. The same was true for assessing one’s financial situation. Consumers found the time to make big purchases like cars, furniture or appliances less unfavorable in March than in February.
Better conditions, but not much more positive
Despite the increase in recent months, De Jong does not expect the economic picture to change suddenly in the coming months. “I think inflation will continue to come down, but we won’t get to 2% very quickly.” In addition, the economist sees the monthly reading on consumer confidence as lower than expected. “Of course we saw significant changes for consumers earlier in the year. For example, the minimum wage has been significantly increased, benefits have been increased, the state pension has been increased, and we are seeing wage growth faster. Taxes have also been reduced.’
“I can hardly imagine that we will see a scenario like what we saw in 2008 and 2009”
Despite all these better circumstances, De Jong does not see the reflected effect on consumer confidence so quickly. ‘I actually thought consumers would be even more optimistic.’ The economist is also curious about the effect of the banking crisis on consumer confidence. ‘We have to wait and see if the consumer will be negatively impacted by this.’ Even if De Jong doesn’t expect the influence on the Netherlands to be big. “I can hardly imagine that we will see a scenario like what we saw in 2008 and 2009.”
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.
