Q2 consumer confidence slips; Q3 spending seen picking up

High prices of fuel and basic goods weighed down on consumer confidence in the first half of the year, according to the Bangko Sentral ng Pilipinas (BSP) on Wednesday. The latest BSP Consumer Expectations Survey learned from 5,700 respondents nationwide that the confidence index decreased slightly to negative 24.1 percent in April to June from -23.1 percent in the first three months of the year. But the same survey showed that the pessimism will be short-lived after respondents said they expect to spend more from June to August “primarily on transportation, fuel, personal care and effects and education." “Despite the continued increase in prices of commodities, more respondents considered the current quarter as a favorable time to buy big-ticket items. Consumer outlook on buying conditions was most upbeat for real estate, followed by consumer durable and motor vehicles," the BSP said in a statement. In a news conference, BSP director Rosabel Guerrero said Filipino consumers will turn optimistic in the next 12 months because they expect economic growth to pick up in the second half of the year after slowing down in the first quarter. The gross economic product (GDP) growth slowed down to 4.9 percent in the first quarter, from 7.3 percent a year earlier, due to government underspending and global trade weakness, according to official figures and analysis from the National Statistical Coordination Board. Guerrero said growth will recover in the second half of the year as conflicts in the Middle East and North Africa get resolved and the ripples of the March 11 earthquake and tsunami in Japan subside. The BSP survey also revealed that nearly all households of overseas Filipino workers, or 97.2 percent, spent the remittances they got on food. Some said they used some of the remittances for education, medical expenses and debt payments. — ELR/VS, GMA News