Pakistan’s Consumer Confidence Sharply Declines in Q3 2021

Dun & Bradstreet Pakistan and Gallup Pakistan have issued their report on ‘Pakistan Consumer Confidence Index (CCI)’ for Q3 2021. The CCI declined sharply to 70.8 points in Q3 2021, compared to 88.90 points in Q2 2021, translating into a 19.6 percent quarter-on-quarter (q-o-q) decrease. This deterioration in sentiment is driven by weakening macroeconomic indicators, primarily an increase in inflation and PKR depreciation. Consumers are perceiving these declining indicators as signals for further deterioration in their personal and economic conditions. Respondents reported a greater decline in Future Expectations (down by 22.7 percent) compared to the Current Situation (down by 14.9 percent) in this quarter. During the current quarter, all CCI parameters witnessed an overall decline. Consumers’ sentiments witnessed the largest deterioration in regards to the Economic Condition of the Country (24.1 percent decline) due to weakening macroeconomic indicators. Unemployment continues to drag consumers’ enthusiasm and remained the most pessimistic parameter (NI = 54.1). The unemployment Situation deteriorated by 21.6 percent q-o-q, with 68 percent of respondents believing that unemployment will increase in the next six months compared to 43 percent in Q2 2021. During Q3 2021 survey, 94 percent of consumers believed that daily essentials have continued to become expensive/very expensive in the last six months compared to 92 percent in Q2 2021. Nauman Lakhani, Country Lead of Dun & Bradstreet in Pakistan, stated, Bilal Ijaz Gilani, Executive Director Gallup Pakistan, added, The CCI report has been developed by assessing Consumers’ Confidence about the economy as well as their personal financial situation. The Index covers four key parameters, i.e., Household Financial Situation, Country’s Economic Condition, Unemployment, and Household Savings. The Index reflects ‘Current Situation’ (economic changes witnessed in the last six months), as well as ‘Future Expectations’ (changes expected for next six months) of consumers across the country. The CCI ranges from 0 to 200, with 100 as the neutral value. A score of less than 100 indicates pessimism, while a score of more than 100 indicates optimism.