Indonesian Consumer Confidence is 153.9 lowest in over two years as COVID-19 coronavirus breaks out in the archipelago

29-Apr-2020 Intellasia | Roymorgan | 6:02 AM Print This Post

In March 2020 Roy Morgan Indonesian Consumer Confidence dropped 5.1pts 153.9 from February. Consumer Confidence is now 7.4pts lower than a year ago in March 2019 (161.3) although it remains a significant 15.8pts above the long-term average (2005-2020) of 138.1 and substantially higher than Australia.

The first confirmed case of the COVID-19 coronavirus in Indonesia was on Monday March 2, 2020 and increased to 1,200 at the end of March and have now increased to over 8,000 in April.

The monthly decrease in Consumer Confidence in March was driven by declines across all five indices led by a 5ppt drop in Indonesians expecting to be ‘better off’ financially this time next year down to 63%.

The impact of COVID-19 has varied greatly across the archipelago. The provinces of Northern Sumatra have had the biggest decline in Consumer Confidence in March, down 25.4pts to 122.1. There has also been a significant drop in the capital Jakarta and the surrounding provinces of West Java, down 7.4pts to 145.6.

“Indonesian Consumer Confidence dropped 5.1pts to 153.9 in March, to its lowest level for over two years since October 2017. The drop in Consumer Confidence came as the COVID-19 coronavirus was confirmed to be in Indonesia in early March,” said Ira Soekirman, director of Roy Morgan Indonesia.

“The spread of COVID-19 was initially concentrated around the capital Jakarta and surrounding areas of West Java which accounted for around three-quarters of all confirmed cases in March. It is no surprise Jakarta and West Java experienced one of the largest declines in Consumer Confidence in March down 7.4pts to 145.6.

“Indonesia has only begun to carry out more extensive lockdowns since mid-April. The impact of these societal restrictions will cause significant economic dislocation over the next few months as many are thrown out of work and Indonesia looks set to experience its first recession since 1998.” said Soekirman.

March drop driven by fall in assessment of personal financial situations

Analysis of the latest consumer confidence compared to a month ago shows the decrease is driven by a fall in Indonesian views about their own personal financial situations both compared to a year ago and over the next 12 months.

In March a decreasing majority of 63 percent (down 5ppts) of Indonesians expect their family will be ‘better off’ financially this time next year (the lowest figure for this indicator for over three years since February 2017) and a low, but increasing, 6 percent (up 2ppts) expect to be ‘worse off’ financially (the highest figure for this indicator in nearly three years since May 2017).

In addition 39 percent (unchanged) of Indonesians consider their families are ‘better off’ financially than this time a year ago while 13 percent (up 4ppts) say their families are ‘worse off’ financially (the highest figure for this indicator for nearly three years since June 2017).

Now a reduced majority of 88 percent (down 3ppts) of Indonesians expect Indonesia will have ‘good times’ financially during the next 12 months, and only 12 percent (up 3ppts) expect ‘bad times’ financially (the highest figure for this indicator for two years since March 2018).

Looking at the longer term, 91 percent (down 2ppts) of Indonesians expect Indonesia will have ‘good times’ economically over the next five years (the lowest figure for this indicator for over two years since September 2017) and 8 percent (up 2ppts) expect ‘bad times’.

A declining majority of 62 percent (down 2ppts) of Indonesians say ‘now is a good time to buy’ major household items and 35 percent (up 3ppts) say ‘now is a bad time to buy’ major household items.

Despite the fall in March, comparing Indonesian Consumer Confidence with the longer-term, the current rating is still a significant 15.8pts above the long-run average (2005-2020) of 138.1.

The monthly Roy Morgan Indonesian Consumer Confidence Rating is based on 1,283 in-depth interviews conducted in March throughout Indonesia, not just a handful of cities. The survey includes the Top 23 cities, smaller cities and towns as well as many more villages in the rural hinterland, reflecting all of Indonesia.

Consumer Confidence remains very high in Indonesia when compared to Indonesia’s Asia-Pacific neighbours Australia April 25/26, 2020 85.0) and New Zealand (March 2020 106.3); long-term Consumer Confidence trends for the three countries are covered extensively here.

http://www.roymorgan.com/findings/8387-roy-morgan-indonesian-cc-march-2020-202004270515

 

Category: Indonesia

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