Consumer confidence remains high in the Philippines

Consumer confidence in the Philippines remained high along with Bangladesh out of 16 Asia Pacific markets, according to the MasterCard Index of Consumer Confidence.

In its latest survey, MasterCard Index revealed that only the Philippines and Bangladesh recorded greater than five index-point improvement in consumer confidence in the second half of 2014.

Consumers in Asia Pacific’s emerging markets remain optimistic despite a slight decline in overall consumer confidence for the region, according to MasterCard Index.

This decrease came after the region recorded the highest consumer confidence score in more than 10 years in the first half of 2014 survey.

Respondents were asked to give a six-month outlook on five economic factors including the economy, employment prospects, regular income prospects, and their quality of life. The Index is calculated with zero as the most pessimistic, 100 as most optimistic and 50 as neutral.

The Asia Pacific markets are optimistic despite a decrease of 2.9 Index points to 65.5 Index points in the second half of 2014 from 68.3 Index points in the first half last year.

MasterCard noted that there were declines across all five key economic indicators for Asia Pacific – economy, employment, regular income prospect, stock market and quality of life.

Bangladesh recorded the single largest improvement in Asia Pacific, moving from optimistic to very optimistic territory at 83.3 index points, up 16.9 index points. It is the only market that saw a double-digit rise in consumer sentiment.
Myanmar, India and Indonesia are the Asia Pacific region’s most optimistic markets, with 97.2 Index points, 91.6 Index points and 90.1 Index points, respectively.
Within Southeast Asia, consumer confidence rose in the Philippines by 7.7 Index points, pushing into optimistic territory (77.1 Index points), while Malaysia saw a deterioration in consumer confidence, down 11.5 Index points to 49.9 Index points in the second half of 2014.

Vietnam and Thailand remained very optimistic, while Singapore remained optimistic.

MasterCard noted that while consumer confidence in China and South Korea stayed stable with muted increases, Japan, Taiwan and Hong Kong posted the sharpest declines in consumer confidence. All three markets plunged below the 50 point neutral mark from the previous survey.

More declines were recorded in Australia, keeping it in pessimistic territory, while New Zealand inched closer to the 50 point neutral mark after falling 9.4 index points to 56.4 index points. Australia’s score is the lowest since the financial crisis low in 2009.

“The slight drop in Asia Pacific’s consumer confidence reflects an outlook of cautious optimism. Consumers across the region are holding their breath for signs of sustained economic growth and opportunity,” said Pierre Burret, head of Delivery, Quality & Resource Management for Europe, Asia Pacific, Middle East & Africa, MasterCard Advisors.

Burret noted that the emerging markets Myanmar, India and Indonesia are the most optimistic because of either positive anticipation for a brighter future or excitement around their respective newly-minted governments.

“Conversely, the developed markets of Northeast Asia such as Taiwan, Japan and Hong Kong were much less optimistic in their outlook. In these markets, the wanted signs of long-term growth and opportunity are blocked by Hong Kong’s recent political crisis and Japan’s weakening yen,” Burret added.