The high cost of living has severely harmed Pakistanis’ ability to save, with 73 percent complaining of a drop in savings amid rising inflation, while 51 percent expect their household savings to decrease in the next six months.
This was brought to light in the latest Consumer Confidence Index survey report released by Gallup Pakistan and Dun & Bradstreet. The survey drew responses from 2,000 people all over the country.
The majority of respondents expressed concern about shrinking savings due to inflation. Approximately 73 percent of Pakistani individuals complained of waning savings. Sentiments regarding household savings noted an extensive decrease (31% quarter-on-quarter), therefore it remains extremely pessimistic in the current situation.
Meanwhile, 43 percent of respondents expect household savings to increase or remain the same in the next six months.
Those who reported an increase in their savings in the previous survey saw their rate fall from 12 percent to 5 percent in the latest survey.
Similarly, there was a 4 percent decrease in the number of people who said in the previous survey that inflation did not affect their savings. According to the most recent survey, only 21 percent of people’s savings are unaffected by inflationary pressure.
Unfortunately, a sizable number of respondents in the latest survey did not anticipate an increase in savings, with 51 percent of Pakistanis dissatisfied with better-saving prospects.
The survey also found a 7 percent decrease in the number of people who were optimistic about increasing their savings in the previous survey. Only 17 percent anticipate an increase in their savings.
Furthermore, those who were unsure about the possibility of increasing their savings in the future increased their rate to 6 percent, up from 4 percent in the previous survey.
On another query, 90 percent of consumers said that daily essentials have become expensive/very expensive in the last six months compared to 93 percent of responses in Q2 2022.
In response to a question on the future of household income, 38% of respondents mentioned that their income levels will decrease in the next six months compared to 22 percent in Q3 2022.
Overall, Household Savings displayed a deterioration in sentiments (decreased by 31.1%). While future household savings are expected to be higher than the current situation, projections for future inflationary trends may offset such expectations.