Consumer confidence flat in May: BI
The Jakarta Post, Jakarta
Consumers continued to be pessimistic about the country's economic prospects despite the improving macroeconomic conditions and the stronger rupiah, a survey revealed.
A survey conducted by Bank Indonesia, quoted by Antara, shows that the Consumer Confidence Index (CCI) was hardly changed in May at 73.5 compared to 73.4 in April.
The central bank said a number of other indices also failed to show any significant progress during the month, further indicating a negative outlook on the economy on the part of consumers.
Bank Indonesia said that consumer expectations regarding the country's economy were still poor, which was reflected in the Consumer Expectation Index which in May stood at 83.3 compared to 85.1 in April.
"Consumers are still pessimistic about the economy although it has shown improvement," the central bank said.
Bank Indonesia surveyed 2,700 households in nine big cities; Jakarta, Medan, Bandung, Surabaya, Semarang, Makassar, Palembang, Bandar Lampung and Banjarmasin.
While consumers were pessimistic about the country's economy, they were confident that the rupiah would strengthen over the next six to 12 months, which was reflected in the rise in the rupiah's Exchange Rate Index in May to 107.7 from 102.7 the previous month.
The survey also showed that consumers were still reluctant to buy durable goods as indicated in the Consumer Spending Index, which rose only slightly to 62.8 from 60.5 the previous month.
Most respondents surveyed said that the rise in the prices of goods and their low purchasing power were the main reasons for them not purchasing durable goods.
According to the central bank, consumer expectations of rises in the prices of goods are still high despite the strengthening of the rupiah against the dollar.
The index measuring family income was slightly better at 108.3 in May, up from 107 the previous month, with 35.3 percent of respondents saying their family income was improving, while 25.1 percent claimed their income was declining.
As for unemployment, 85.3 percent of the respondents said the unemployment rate was still high that month.
The index measuring expected inflation, however, was down to five from 10.8 in April. Inflation in May was recorded at 0.8 percent, higher than the deflation of 0.24 percent in April.
The survey, however, contradicts another survey conducted by The Danareksa Research Institute, which indicated that consumer confidence continued to rise that month.
According to Danareksa, the Consumer Confidence Index rose in May for the fourth consecutive month in a row, as consumers gained optimism about the ongoing upturn in the Indonesian economy.
The Danareksa results showed the Consumer Confidence Index (CCI) up 0.5 percent at 99.3 percent, with the Present Situation Index (PSI) moving up to 82.7 from 81.3 in April.