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Philippine consumers more optimistic but still cautious about large purchases – BSP survey

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MANILA, Philippines – The Philippines has become more optimistic about its economic outlook in the third quarter of 2021 as well as the next 12 months, according to the latest survey of consumer expectations conducted by Bango Sentral ng Pilipinas (BSP).

In a press conference, the BSP said that the consumer sentiment was more optimistic in the current quarter and the year ahead compared to previous periods.

In particular, the confidence index for the third quarter of 2021 fell to a positive 1.3% from the previous quarter’s survey result of -2.2%, while the next 12 months’ measurement rose to 19.8% from the previous quarter’s survey result of 17.9%.

“According to respondents, their improved prospects in the current quarter were due to their expectations for more jobs and permanent employment; additional or higher income and effective government policies and programs, in particular to address COVID-19 related concerns, such as the availability of vaccines, the provision of financial assistance and the easing of quarantine restrictions, ”the BSP added in a statement.

However, the survey also showed that the outlook for household spending on basic goods and services in the third quarter of 2021 fell to 25.4% after providing a 29% improvement in the previous quarter’s survey results.

More importantly, the study revealed “record low purchase intentions for major ticketing items over the next 12 months,” the agency added.

The share of households that considered the next 12 months as a favorable time to buy big-ticket goods fell to 3.7% in the first quarter of 2021 – the lowest measurement since the 3.6% recorded in the first quarter 2007.

Recent survey results also showed that consumers expected interest rates to rise and the peso to fall in the third quarter of the year as well as over the next 12 months.

“Respondents also expected unemployment to rise in the third quarter of 2021 but fall over the next 12 months,” BSP said. “Households expected the rise in commodity prices to remain within the government’s inflation target of 2 to 4 percent in 2021 – 3 percent in the third quarter of 2021 and 3.2 percent in the next 12 months.”

The study also revealed that approx. one in four households took out a loan during the last 12 months, of which 90.2% experienced lighter debt applications.

These findings are contained in the second quarter Consumer Expectations Survey conducted between April 21 and May 1, 2021.

For the last quarter survey, 5,702 households were surveyed, with 50.2% of respondents from the National Capital Region and 49.8% from provincial areas.

Of the sample size, 5,581 households responded to the survey, corresponding to a response rate of 97.9%. The middle-income group accounted for the largest percentage of respondents with 40.3%, followed by the low-income group with 36% and the high-income group with 23.7%.

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