Consumer confidence tumbles to historic low, Danareksa says

The Jakarta Post, Jakarta

The country's consumer confidence tumbled to a "historic" low in February on discontentment at the government's inability to boost strong economic growth, which would generate adequate employment opportunities, Danareksa Research Institute said.

The consumer confidence index (CCI) tumbled 10.2 percent, to 82.3, from 91.6 in January, marking a further rise in the number of pessimists that had already outnumbered optimists since September last year, the institute said in a statement.

The February index is at "its lowest-ever level in the history of the survey," said Danereksa, which has carried out the survey regularly since 1999.

The survey was made about a month ahead of the Iraq war but it did not specify if war fears, which haunted the global economy months before the war, were a factor contributing to the drop in the CCI.

Danareksa said its survey also noted a record fall of confidence in the appraisal of the current economic situation to a low never seen before in the history of the survey. The index gauging sentiment on the economy in February dropped by 25.5 percent.

Accordingly, job seekers lost 15.3 percent of their confidence, with the index falling to 41.2, its lowest-ever level in the survey's history.

"With no signs of a marked change in the course of economic affairs in February, consumers see dimming prospects for the economy over the next six months," it said.

Confidence to get jobs in the next six months floundered 6.3 percent to a new low, at 89.0.

Another fresh low was also recorded by the index on family income prospects, which fell to 97.8.

With concern on family income prospects ahead, shoppers are more averse to spending on durable goods. Only 21.3 percent of respondents expressed a desire to buy big-ticket items, down from 25.3 percent the previous month, as people are concerned about limited fresh opportunities ahead.

"It is indeed the economy's inability to grow sufficiently fast to offer new jobs that has disappointed a lot of people, with the disappointment straightaway directed at the government as the executive agent constitutionally entrusted to steer the nation," it said.

The index of consumer confidence in government (CCGI) slipped again by 6.5 percent to 106.0, with all components of the index on the decline.

While it is true that the government was responsible for setting employment-generating growth as the Cabinet's single goal, the ultimate results of the goal rested also on all people, especially the judiciary and lawmakers.

As such, it said, the lawmakers and judiciary ought also to be blamed for the lack of job opportunities.