KUALA LUMPUR, May 21 — Malaysia remains the sixth most confident country among 64 nations surveyed in the Consumer Confidence Index (CCI) for the first quarter of 2019, even as concerns over the economy continue to linger.
With an index score of 115 in Q1 2019, three points lower than the last quarter, the country has still posted the fourth-highest year-on-year gain, up by 11 points compared to Q1 2018.
The three indicators used in the survey were consumers’ perception on local job prospects, personal finances and the intention or readiness to spend.
Although the CCI noted the perception of personal finances and job prospects are in line with the previous quarter, there has also been a significant decrease in the willingness or intent to spend.
The index revealed that 71 per cent of Malaysians believe the state of their personal finances in the next 12 months will be excellent or good, and 70 per cent have a positive view of job prospects in the next 12 months.
However, 48 per cent said, “Now is the time to buy the things they want and need”.
This has resulted in a more cautious approach to spending, as close to nine in 10 Malaysians, or 88 per cent, said that they have adjusted their spending habits to save on household expenses.
Managing Director of Nielsen Malaysia Luca De Nard, whose organisation collaborated with index producer Conference Board Global Consumer Confidence Survey, said it is clear that Malaysians’ perception of the economy does not correlate with actual economic performance.
“For example, we experienced consecutive quarters of low inflation, a consistently low unemployment rate of 3.5 per cent and GDP growth of 4.7 per cent in Q4 2018, all of which contributed to healthy total fast-moving consumer goods growth of 4.9 per cent in 2018,” he said in a statement.
Yet, in Q1 2019, there has been a significant rise in concerns about the economy compared to the previous quarter, showing that messages surrounding the country’s strong economy are not at the forefront of consumers’ minds.
“The bottom line is that Malaysians have always been financially prudent. We know from our ‘Shopper Trends’ study that a majority of consumers are price sensitive and nearly half actively seek out in-store promotions.
“Brands who want to win the consumer share of wallets would do well to keep these behaviours in mind,” De Nard said, adding that when it comes to spending their spare cash, more than half of consumers put it towards their savings, with 44 per cent paying off their debts, credit cards and loans, while just over a third spend on holidays or vacations.