According to a nationally representative sample of 339 Georgians interviewed in early March 2019, the Consumer Confidence Index (CCI) slightly improved by 0.3 index points, from -19.2 in February to -18.9 in March. A similar pattern was observed in both sub-indices: the Present Situation Index increased by 0.2 (from -23.8 to -23.6), and the Expectations Index by 0.4 index points (from -14.6 to -14.1) compared to February. It is worthwhile to mention that the spring season seems to affect consumer confidence positively since 2015 (although data for April 2019 are not accessible yet).
Table 1: Change in Consumer Confidence (in Index Points): March 2019
|Is now the right time for people to save in Georgia?||6.7|
|Do you expect prices to increase more rapidly in the next 12 months?||4.2|
|Your ability to save, next 12 months||4.1|
|Your current ability to save?||2.8|
|Do you expect to increase spending on major purchases compared to the past, next 12 months||2.0|
|The expected level of unemployment in Georgia, next 12 months||1.2|
|How did the general economic situation change in Georgia in, past 12 months||1.1|
|How much did consumer prices rise in, past 12 months||-0.6|
|Your financial situation, past 12 months||-2.9|
|How will your financial situation change in, next 12 months||-3.7|
|General economic situation, next 12 months||-5.2|
|Is now the right time for people to make major purchases in Georgia?||-6.3|
Table 1 demonstrates which questions are responsible for the slight improvement in Consumer Confidence for the current month, March. The most improvement is observed in the questions concerning savings (current and future) and expected inflation. Consequently, the greatest drop is detected in the questions related to the expected general economic and personal financial situation, and with the leading drop being spotted in the question regarding major purchases at present.
TBILISI VS REST-OF-GEORGIA
It is worth noting that the gap in consumer sentiment between Georgia’s rural population and people living in the capital has been expanding since September 2017. It reached its maximum value (about 21 index points) exactly one year ago, in March 2018, since we started collecting CCI data. This gap first started shrinking until October 2018, afterward experiencing another large drop in November 2018, about 18 points, and has been hovering around 10-13 index points ever since. As for the month of March, consumer confidence dropped in value by 0.8 index points, from -14.1 in February to -14.8 in March. Whereas, Rest-of-Georgia showed a little improvement, by 0.3 index points, from -24.3 in February to -23.9 in March. It is also noteworthy, that the decline in consumer confidence for Tbilisians is caused by the present situation, Present Situation Index being fallen in March by 1.9 index points, from -13.8 to -15.7. While in expectation Georgia as a whole shows a bit of progress (Expectations Index is up by 0.4 index points for Tbilisi and Rest-of-Georgia as well).
Table 2: Change in Consumer Confidence (in Index Points): Tbilisi and Rest-of-Georgia, March 2019
|Is now the right time for people to make major purchases in Georgia?||-10.6||-6.0|
|Your financial situation, past 12 months||-6.5||-0.1|
|General economic situation, next 12 months||-3.8||-5.6|
|How will your financial situation change in, next 12 months||-3.0||-3.3|
|Is now the right time for people to save in Georgia?||-0.3||13.2|
|Do you expect to increase spending on major purchases compared to the past, next 12 months||0.5||3.3|
|Do you expect prices to increase more rapidly in, next 12 months?||1.0||9.4|
|Your current ability to save?||1.4||2.2|
|How did the general economic situation change in Georgia in, past 12 months||1.6||-0.5|
|How much did consumer prices rise in, past 12 months||2.6||-7.1|
|Your ability to save, next 12 months||2.6||2.9|
|The expected level of unemployment in Georgia, next 12 months||5.0||-4.3|
Table 2 shows which questions caused the decline in the Present Situation Index for Tbilisians for the month of March. Apparently, compared to February 2019, Tbilisians are not positive about their financial situation and making major purchases (such as furniture, electronic devices, etc.) at present. The latter applies to the rest of Georgians as well, though having a much smaller magnitude. It is also of equal importance to notice that the population in Rest-of-Georgia experienced progress regarding savings at present (“Is now the right time for people to save in Georgia?”, “Your current ability to save?”).
Note: Questions marked in red are concerned with the present situation.
MONTHLY AND YEARLY CHANGES IN THE CCI VARIABLES