MIER: Consumers continue to lack confidence over Malaysia's economic well-being

In its Consumer Sentiments Survey Report for the third quarter (Q3) of 2020, the think-tank said consumers remain in cautious mode as the Covid-19 pandemic continues to wreak havoc in the world. — Picture by Hari Anggara
In its Consumer Sentiments Survey Report for the third quarter (Q3) of 2020, the think-tank said consumers remain in cautious mode as the Covid-19 pandemic continues to wreak havoc in the world. — Picture by Hari Anggara

KUALA LUMPUR, Oct 21 — Malaysian Institute of Economic Research’s (MIER) latest Consumer Sentiments Index (CSI) indicates a continuing lack of confidence among consumers over their economic well-being currently and for the rest of this year.

In its Consumer Sentiments Survey Report for the third quarter (Q3) of 2020, the think-tank said consumers remain in cautious mode as the Covid-19 pandemic continues to wreak havoc in the world.

This is reflected in the latest CSI which, at 91.5, has changed little from the prior quarter’s 90.1 and remains below the 100-point optimism threshold, MIER said.

Notwithstanding the sluggish labour market, consumers’ financial situation has held up fairly well recently, the institute said.

“Going forward, they are also not keyed up about their financial outlook, albeit growing concerns about the job market.

“Shopping, however, which piqued the interest of more consumers last quarter, looks likely to be in moderation this time around,” it said.

According to the report, household finances are expected to hold their own in the next six months.

The proportion of those anticipating an upward adjustment in their financial position soon has remained the same as the previous quarter’s 21 per cent.

“Those who expect their finances to worsen in the coming months have shrunk for the second consecutive quarter to a two-year low of 18 per cent,” it said.

Employment prospects, MIER said, are a big disappointment.

An absolute majority of 63 per cent of the survey respondents were of the view that jobs were scarce in Q3 2020, up from 62 per cent and 52 per cent in Q2 2020 and Q3 2019, respectively.

“Those who thought otherwise have remained the same this quarter as the prior quarter’s 12 per cent, suggesting that the labour market has remained gloomy for at least six months now,” the institute said.

Meanwhile, consumers are planning to shop prudently in the coming months.

Housing demand is expected to pick up more momentum before 2020 is out, while cars and personal computers are also looking more attractive this time than previously, it said.

With Covid-19 remaining a threat, interest rates have been heading anywhere but up and consumers who are financially stable are going house hunting soon.

In the latest survey, 15 per cent of the households queried placed home purchase at the top of their shopping list, rising three percentage points over Q2 2020. Among them, the high-income consumers are the most enthusiastic this time around, MIER added. — Bernama

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