Consumers heartened by Mega's ascension

Consumers heartened by Mega's ascension

Adianto P. Simamora, The Jakarta Post, Jakarta

Consumer confidence soared sharply in August due to the
country's leadership succession, according to the recent consumer
confidence survey conducted by Danareksa Research Institute.

Danareksa said on Wednesday that the consumer confidence index
increased to 112.3 in August from 94.1 in July, which was the
first increase after it had fallen below 100 since March due to
domestic political uncertainty.

Danareksa, however, stressed that the index increase did not
produce any major changes in the country's economic fundamentals
as it merely reflected a change in sentiment following the
successful transfer of power to President Megawati Soekarnoputri
from Abdurrahman Wahid in late July.

The rupiah soared to around Rp 8,500 per U.S. dollar in August
following the election of Megawati and the forming of a credible
cabinet team. The rupiah hovered at between 10,000-11,000 when
Abdurrahman faced mounting pressure from legislators to step
down.

The institute surveyed some 1,700 households in six different
areas to measure the buying pattern of consumers and its effect
on the economy.

Elsewhere, Danareksa said the present situation index and the
expectation index also rose in August to 83.4 and 133.9 from 73.6
and 109.3 respectively.

"The 22.5 percent rise in the expectation index reflected a
bullish expectation that the new President would be able to start
solving the country's political and economic woes," Danareksa
said.

The consumer confidence in the government index (CCGI)
increased to 152.6 from 105.8.

"The rise in the CCGI showed that the public were confident of
the government's ability to meet consumers' expectations in all
provinces as well as its ability to woo back investors and
rebuild the economy," Danareksa said.