Neilsen survey cites deteriorating personal finances, job outlook

Hong Kong's consumer confidence dipped in the third quarter as personal financial circumstances deteriorated and the job outlook grew dimmer, a survey released by research firm Nielsen on Thursday shows.

Despite being the seventh highest among the 56 markets surveyed, the city's confidence level slipped three points to 104 in the third quarter from the previous quarter, according to Nielsen's survey of global consumers conducted between August 30 and September 16.

Globally, consumer confidence dropped one point to 88 in the third quarter amid increasing concerns over a volatile and challenging world economy.

Consumer sentiment on the Chinese mainland was also weaker, edging down one point to 104. A score below 100 signals the degree of pessimism, while that above 100 shows the level of optimism.

Dimmer job prospects and the worsening state of personal finances have made Hong Kong consumers more cautious.

"While the outlook for job prospects and state of personal finances have dropped significantly in the latest quarter, overall spending intentions for the next 12 months have remained stable," Oliver Rust, managing director of Nielsen Hong Kong, told reporters Thursday.

With the city's jobless rate remaining at a 13-year low in the three months to September, 55 percent of the Hong Kongers surveyed said they expected the job market will improve in the next 12 months, down from 62 percent in the previous quarter.

Meanwhile, fewer people saw their state of personal finances improving in the coming 12 months than during the second quarter.

Turmoil on the stock market over the past few months has also taken a toll on people's purse strings, with the average liquid assets of Hong Kongers decreasing in the third quarter, according to Nielsen's report.

People's willingness to spend, however, remained largely unchanged from the previous quarter.

This is mainly because the spending intentions of people aged 40-49, the city's most affluent age group, remains very strong, the report says.

Increasing food prices continue to be Hong Kong people's top concern.

The city's inflation accelerated to 7.9 percent in July, a 16-year high.

Food prices, after growing an average 6.8 percent in the second quarter, gained 7.7 percent in the third quarter.

The latest report reveals that in response to heightened inflationary pressures, people in Hong Kong are paring down their budgets on activities such as eating out and buying new clothes. And more often than not they are on the lookout for bargains and value packages, the report claimed.

As consumers seem poised to further tighten their belts, the city's retail sales growth has shown signs of easing, slowing to 15.2 percent in September from 20.7 percent in August.

emmaan@chinadailyhk.com

China Daily

(HK Edition 11/04/2011 page2)