Pakistan’s Consumer Confidence Index increased to 77.0 points in Q4 2021 as compared to 70.8 points in Q3 2021, translating into an 8.8 percent quarter-on-quarter (QOQ) increase.
Dun & Bradstreet Pakistan and Gallup Pakistan have issued their report on ‘Pakistan Consumer Confidence Index (CCI)’ for Q4 2021. The Consumer Confidence Index increased to 77.0 points in Q4 2021. This improvement in sentiment is driven primarily by improvement in future expectations as respondents reported a greater increase in Future Expectations (up 13.6 percent) as compared to the Current Situation (up 2.3 percent) in this quarter.
During the current quarter, all the CCI parameters had a slight improvement while still indicating pessimism that was driven primarily by an increase in future expectations (up 13.6 percent) QOQ. The overall increase primarily stemmed from improved perceptions regarding Household Savings (up 16.3 percent).
Unemployment continues to drag consumers’ enthusiasm and remained the most pessimistic parameter (NI = 55.3). Across all the parameters, consumers were only optimistic about the Future Financial Situation (NI = 109.3). During the Q4 2021 survey, 91 percent of consumers believed that daily essentials have continued to become either expensive or very expensive in the last six months when compared to 94 percent in Q3 2021.
Dun & Bradstreet’s Country Lead in Pakistan, Nauman Lakhani, stated,
The eighth issue of Pakistan Consumer Confidence marks the end of the calendar year 2021 and completion of two cycles of CCI. Current Consumer Confidence growth of almost 9 percent as compared to the sharp decline last quarter is healthy, but consumers remain in the ‘pessimistic’ zone. The slight improvement is a likely indication of normalizing demand, amidst people adapting to the new normal.
Bilal Ijaz Gilani, the Executive Director of Gallup Pakistan, added,
The current quarter results show improvement in overall consumer sentiment, driven largely by the improved expectation for the future. Having said this, the overall sentiment remains in the negative with the majority rating the current and future situation of their finances to be in dire straits. Given the continued pressure of inflation, slow economic growth, and the disparity between small vs large and those selling to domestic vs international markets growing, the chances of sentiments improving drastically in the short term are low as well. Businesses, therefore, need to keep this current and short-term forecast in mind while planning for expansion.
The CCI report has been developed by assessing Consumers’ Confidence about the economy as well as their personal financial situation. The Index covers four key parameters — Household Financial Situation, Country’s Economic Condition, Unemployment, and Household Savings. The Index reflects ‘Current Situation’ (economic changes witnessed in the last six months), as well as ‘Future Expectations’ (changes expected for next six months) of consumers across the country.
The CCI ranges from 0 to 200, with 100 as the neutral value; a score of less than 100 indicates pessimism while a score of more than 100 indicates optimism.
