Confidence falls in China

BEIJING: Consumer confidence levels are declining in China, where shoppers are wary about the current economic and business climate.

MNI, a unit of the Deutsche Börse Group, polled 1,005 urban respondents, and found its barometer of popular sentiment stood at 89.3 points in September, on a scale where 100 points indicated neutral attitudes.

This constituted the third successive monthly contraction, down from a recent high of 101.6 points in June, and lagging the 90.9 points posted in July and the 90.4 points recorded in August.

"Sluggish economic data and a lack of new government policy stimulus contributed to weaken sentiment," the study argued.

Optimism levels fell in central and western regions, offsetting gains in the northeast and southeast. Both younger and elderly shoppers became more downbeat, but positivity rose among middle-aged consumers.

When asked to discuss the current situation overall, the panel returned 91.3 points, the worst total since January 2012. The expectations index, however, improved by 0.3 points to 88.2 points month on month.

Upon assessing their personal financial circumstances at present, contributors logged 101.6 points, also the lowest figure of 2012 thus far. The forward-looking reading here again climbed slightly to 118.4 points.

Inflation is an ongoing source of concern, and while appraisals of the employment market proved more favourable, this was because fewer people anticipated a deterioration, rather than renewed optimism.

Perceptions of the business climate for the next year similarly remained positive on 110.2 points, but were the worst in four years. The five-year forecast jumped by 3.3 points to 135.8 points.

The willingness to buy consumer durables, which are relatively big ticket purchases, reached 106 points, down from 107.2 points in August, and only 0.5 points behind the average since September 2011.

Within these findings, intentions to acquire a car fell to a new nadir since MNI began collecting data in 2007, posing a challenge for manufacturers in this highly competitive sector.

"The number of consumers saying it was a good time to buy a house decreased, largely due to higher prices, while more people thought it was a good time to sell," the study added. "But the outlook for housing prices dropped in September."

Data sourced from MNI; additional content by Warc staff, 5 October 2012

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