Global Consumer Confidence...3 THE CONFERENCE BOARD® GLOBAL CONSUMER CONFIDENCE REPORT Q2 2018...

2nd QUARTER 2018 RESULTS

CONTENTS

Global Highlights

Asia-Pacific

Africa and the Middle East

Latin America

North America

Europe

Global Consumer ConfidenceThe Conference Board® Global Consumer Confidence Survey is conducted in collaboration with Nielsen

THE CONFERENCE BOARD® GLOBAL CONSUMER CONFIDENCE REPORT Q2 2018 RESULTS www.conferenceboard.org2

Global Highlights

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Global Consumer Confidence Moves Downward for First Time in Two Years

GLOBAL CONSUMER CONFIDENCE INDEX Q2 2018: 104

Venezuela67

Venezuela67

UK101

UAE116

UAE116

Thailand102

Thailand102

Taiwan76

Taiwan76

Sweden99

Sweden99

Spain92

South Korea56

South Korea56

Saudi Arabia107

Saudi Arabia107

Russia70

Russia70

Philippines127

Philippines127

Norway92

Norway92

Morocco70

Japan83

Japan83

Italy62

Italy62

Israel102

Israel102

Greece67

Greece67

Germany107

Germany107France

78

Colombia101

Vietnam120

Vietnam120

US123

US123

South Africa90

South Africa90

New Zealand102

New Zealand102

Mexico96

Mexico96

Kazakhstan84

Kazakhstan84

Indonesia127

Indonesia127

India124

India124

China113

China113

Chile91

Chile91

Canada102

Canada102

Brazil81

Brazil81

Australia93

Australia93Argentina

76Argentina

76

GLOBAL CONSUMER CONFIDENCE INDEX, Q2 2018: 104

56 127

Confidence across the globeThe Conference Board® Global Consumer Confidence Index declined by 2 points in the second quarter of 2018 to 104 from 106 in the first quarter. This is the first time the index has declined in two and a half years.

• Globally, optimism about job prospects, personal finances and intentions to spend have somewhat declined compared to the previous quarter, albeit there is large variation across countries.

• While the biggest concern for consumers globally over the next six months is the economy, it is closely followed by concerns about personal health and job security.

• The ongoing trade and tariff war is likely to affect consumer sentiments in several economies, including the US, Canada, China, and Mexico.

Confidence across regions• Asia-Pacific The decline in confidence was most visible in the Asia-Pacific

region, with 11 of the 14 countries showing a decline except Malaysia, Australia, and Indonesia. Still, six Asian economies (China, India, Indonesia, Malaysia, Philippines, and Vietnam) are in the top-10 countries with the highest confidence levels in the world.

• Latin America Confidence that was already relatively low, declined, driven by large declines in Argentina and Brazil.

Q2 2018

Q1 2018

PT CHG

Global Consumer Confidence Index

104 106 -2

North America 121 121 0Asia-Pacific 112 115 -3Africa & The Middle East 93 91 2Europe 87 86 1Latin America 86 88 -2

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• Europe Despite the global drop, confidence still increased in 34 countries, of which 24 are located in the broadly defined European region. But three of the largest economies in Europe showed a modest decline (France, Germany and Italy).

• North America Confidence was unchanged between the first and second quarters. The level for the United States remained the 4th highest in the world.

• Middle East & Africa Confidence was slightly up, primarily driven by a large increase in Saudi Arabia.

A moderation in consumer optimismThe Conference Board Global Consumer Confidence Index® (“TCB Global CCI”) declined by 2 points in the second quarter of 2018 and is back to its Q2 2017 level. While this is the first time the index has declined in two and a half years, the overall index remains in optimistic territory. Generally, a reading of above 100 is considered positive.

The moderation in optimism among consumers correlates with the performance of the global economy, which is not expected to accelerate in 2018. The May 2018 update of The Conference Board Global Economic Outlook projects global GDP to grow at 3.2 percent this year, the same rate as last year, with both emerging markets and mature economies seeing no uptick in growth.

The decline in global confidence was driven by consumers in both mature and emerging markets. Asia-Pacific was the most dominant driver of the decline, followed by Latin America. In Asia-Pacific, the overwhelming majority of countries experienced a loss of confidence. Latin America’s decline was less concentrated across countries, with half experiencing a moderate decline.

Globally, consumers were less enthusiastic about job prospects, their personal financial situation, and their spending intentions than last quarter.

North America, despite a slight decline in Canada, managed to maintain the region’s con-fidence level, while both Europe, Africa, and the Middle East posted small increases. Most European economies continued to show improvements in consumer confidence, although some modest declines were noted in large economies such as France, Germany, and Italy. In Africa and the Middle East, the majority of countries saw an increase in confidence.

Globally, consumers were less enthusiastic about job prospects, their personal financial situation, and their spending intentions than last quarter. However, sentiment regarding job and financial prospects remains positive, whereas sentiment regarding spending does not.

Looking ahead, if consumers become apprehensive about job prospects, sentiment regarding their financial well-being will be impacted, and their spending intentions could further worsen. This, in turn, may cause consumers to more carefully weigh, or even postpone, discretionary spending and purchase of durables. However, for the time being, sentiment in several larger economies remains relatively high and should continue to support further consumer spending.

Hotspots where market potential for the coming months remains strong include the US, the UK, Germany, Poland, the Netherlands, China, India, Indonesia, Philippines, Malaysia, and Saudi Arabia. On the flip side, some economies where confidence was already at lower levels—Italy, France, Portugal, Turkey, South Korea, Taiwan, Japan, Argentina, Brazil, Chile, and South Africa—show a further deteriorating trend.

Global Highlights


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Global Ranking


Country Rank Q2 2018

Indonesia 1

Philippines 2

India 3

US 4

Vietnam 5

Denmark 6

Malaysia 7

UAE 8

Pakistan 9

China 10

Czech Republic 11

Ireland 12

Germany 13

Saudi Arabia 14

Netherlands 15

Hong Kong 16

Poland 17

Canada 18

New Zealand 19

Thailand 20

Israel 21

Austria 22

UK 23

Colombia 24

Sweden 25

Switzerland 26

Mexico 27

Singapore 28

Australia 29

Slovakia 30

Norway 31

Spain 32

Country Rank Q2 2018

Romania 33

Belgium 34

Chile 35

Peru 36

South Africa 37

Estonia 38

Turkey 39

Slovenia 40

Costa Rica 41

Bulgaria 42

Portugal 43

Kazakhstan 44

Japan 45

Finland 46

Brazil 47

Hungary 48

Latvia 49

Egypt 50

Croatia 51

France 52

Lithuania 53

Taiwan 54

Argentina 55

Serbia 56

Russia 57

Morocco 58

Belarus 59

Greece 60

Venezuela 61

Italy 62

Ukraine 63

South Korea 64

127

127

124

123

120

118

117

116

115

113

108

108

107

107

106

105

105

102

102

102

102

101

101

101

99

99

96

94

93

93

92

92

92

91

91

90

90

88

88

87

87

85

85

84

83

83

81

80

80

80

79

78

78

76

76

75

70

70

67

67

67

62

62

56

127

127

124

123

120

118

117

116

115

113

108

108

107

107

106

105

105

102

102

102

102

101

101

101

99

99

96

94

93

93

92

92

92

91

91

90

90

88

88

87

87

85

85

84

83

83

81

80

80

80

79

78

78

76

76

75

70

70

67

67

67

62

62

56

Increase from previous quarter No change from previous quarter Decrease from previous quarter



Asia-Pacific


Consumer optimism in Asia-Pacific is moderating, yet the region maintains the second-high-est level of consumer confidence globally, after North America. Most countries in the region maintain a relatively high level of confidence. The region in general, and large countries like China and India in particular, still presents a strong growth opportunity for consumer-centric businesses. Businesses, however, may want to closely follow the developments in trade and tariff wars, which could undermine growth prospects and consumer sentiment in the region.

• Overall consumer confidence in the region declined by 3 points from 115 in the first quarter of 2018 to 112 in the second quarter.

• Japan, Singapore, South Korea, Taiwan, Hong Kong, and New Zealand all saw a decline in confidence of 2 or more points.

• Only two countries, Australia and Malaysia, saw an improvement in confidence of 2 or more points.

• The relative share of respondents who are optimistic regarding job prospects has declined marginally.

• There is significant heterogeneity across countries in terms of confidence levels, yet the region maintains a relatively high level of confidence, and thus remains a strong and buoyant consumer market.

In contrast to the general moderation in the region’s consumer confidence, two countries, Australia and Malaysia, saw an improvement in confidence, with the magnitude of increase being substantially greater in Malaysia. Consumers in Malaysia were considerably more optimistic about job prospects, personal finances, and spending for the next 12 months.

Consumers remain confident despite slight overall decline—region still presents a strong growth opportunity for consumer‑centric businesses

GLOBAL CONSUMER CONFIDENCE INDEX FOR ASIA-PACIFIC, Q2 2018: 112

Thailand102

Taiwan76

South Korea56

Singapore94

Malaysia117

Japan83

Indonesia127

Hong Kong105Vietnam

120 Philippines127

New Zealand102

India124

China113

Australia93

GLOBAL CONSUMER CONFIDENCE INDEX FOR ASIA-PACIFIC, Q2 2018: 112

56 127

Q2 2018

Q1 2018

PT CHG

Asia-Pacific 112 115 -3

Indonesia 127 127 0Philippines 127 128 -1India 124 130 -6Vietnam 120 124 -4Malaysia 117 104 13China 113 115 -2Hong Kong 105 107 -2New Zealand 102 104 -2Thailand 102 110 -8Singapore 94 97 -3Australia 93 91 2Japan 83 86 -3Taiwan 76 79 -3South Korea 56 59 -3



Low and declining inflation and a generally stable unemployment rate probably have helped boost consumer sentiment in Malaysia. However, since the election in May, near-term economic uncertainty in Malaysia has increased, which in turn might hamper consumer sentiment in the upcoming months. Confidence went up moderately in Australia, with only consumers’ perceptions of job prospects and their personal financial situation improving. Consumers’ remain reluctant to spend, though there appears to be some positive momentum possibly due to moderate declines in unemployment and inflation rates. Looking ahead, further improvements in confidence may be impacted by opposing factors; falling house prices and rising debt burden on the one hand, and the recent cuts in income taxes on the other.

The region, especially China and India, still present strong growth opportunities for consumer-centric businesses.

Confidence declined in most other Asia-Pacific countries, with the largest declines recorded in Thailand, India, and Vietnam. Recession perception is mounting in Thailand, with 80 percent of respondents saying the country is currently in a recession. Nevertheless, consumers are divided in their sentiment that Thailand will still be in recession in the next 12 months, with one-third saying yes and one-third saying no. In India, optimism regarding personal finances and spending intentions have declined considerably. Increasing oil prices have evoked pressure on inflation and macroeconomic prudence in India, which is likely to have influenced consumer sentiment. Inflation fears amid rising oil prices are also impacting consumer confidence and purchasing power in Vietnam. Despite the current weakening in confidence, given the large potential for growth and consumer market expansion in these economies, confidence is likely to stay at high levels in the coming months.

Some of the region’s more mature economies, such as Japan, Singapore, South Korea, Taiwan Hong Kong, and New Zealand all saw moderate declines in confidence. In all these countries, except in Hong Kong and New Zealand, the confidence levels are also relatively low. In Japan, consumers’ optimism regarding their personal finances and job prospects is fading, while pessimism over the future of the economy is rising. Consumers in Korea, Taiwan, and Singapore are increasingly pessimistic about job prospects, personal finances, and spending. Concerns over rising oil prices and the impact of a trade and tariff war cast a cloud over the economic and consumer outlook in all these countries. While rising household debt would add a further constraint to Korean consumers, high wages and strong labor markets may be a positive for Singapore’s consumers.

The largest economy in the region, China, had a decline in confidence of 2 points, despite the continuing role of consumption in supporting its economic growth. However, the level of confidence remains relatively high, ranking 10th among all countries surveyed. As in the last quarter, almost 70 percent of respondents consider job prospects as good, and 66 percent consider their personal financial situation as good. There was a slight decline in the buying tendency of consumers, but overall consumers remain positive. Even with several challenges, including the uncertainties around trade tensions with the US and domestic financial deleveraging, China’s large consumer market is likely to continue to offer businesses growth opportunities.

Asia-Pacific



Africa and the Middle East

Confidence improves but recession concerns persist


GLOBAL CONSUMER CONFIDENCE INDEX FOR AFRICA/MIDDLE EAST, Q2 2018: 93

UAE116

South Africa90

Saudi Arabia107

Pakistan115

Morocco70

Egypt80

GLOBAL CONSUMER CONFIDENCE INDEX FOR AFRICA/MIDDLE EAST, Q2 2018: 93

56 127

Q2 2018

Q1 2018

PT CHG

Africa & The Middle East

93 91 2

UAE 116 110 6Pakistan 115 107 8Saudi Arabia 107 95 12South Africa 90 95 -5Egypt 80 85 -5Morocco 70 67 3

In Africa and the Middle East, the overall consumer confidence index level improved by 2 points to 93 in the second quarter of this year, after a 1-point decline in the previous quarter. Confidence remains lower than in Asia-Pacific and North America but is higher than in Europe and Latin America. Improving confidence levels are indeed positive news for consumer-oriented businesses that focus on the Middle East and African economies. While some countries in the region already offer an affluent consumer market, others have significant potential to expand their market base, which makes the region a promising location for businesses.

• The overall consumer confidence in Africa and the Middle East improved in the second quarter of 2018.

• The level of overall consumer confidence remains lower than Asia-Pacific, North America, and the global average.

• Saudi Arabia had the largest gain in confidence, followed by Pakistan and the United Arab Emirates. Confidence levels in these countries remain above 100.

• Morocco posted only a modest gain of 3 points, but confidence levels remain well below the global or regional levels.

• Consumer confidence declined in only in two countries in the region, South Africa and Egypt, by 5 points each

• Overall, consumers in the region are optimistic about their personal financial situation, but less so about job prospects. Recession concerns persist.

The improvement in the overall index for the region was driven by a decline in pessimism over spending intentions. Consumers’ perceptions about job prospects and their personal finances for the next 12 months remained somewhat unchanged from last quarter, but overall the region’s consumers remain pessimistic about spending and job prospects.



Moreover, the improvement was mixed. The largest economy in this group, Saudi Arabia, had the largest gain in the region, followed by Pakistan and the United Arab Emirates (UAE), while South Africa and Egypt experienced declines.

Improving confidence levels are indeed positive news for consumer-oriented businesses focused economies in the Middle East and Africa.

Saudi Arabia, and the UAE already have an affluent consumer market exhibiting high and improving confidence. Both countries are also trying to diversify their economies to reduce the overreliance on oil, which includes attempts to stimulate investment—both individu-ally and as a joint venture between the two countries. Rising oil prices and the consequent improvement in income growth in Saudi Arabia has eased the government’s effort for fiscal expansion, which helps boost consumption. Negative sentiment in the first quarter, perhaps driven by the introduction of the value-added tax in January, seems to be dissipating, and consumers are gaining confidence in both the economy and their financial situation. The recent policy change allowing women in Saudi Arabia to drive might also be improving consumer sentiment, as it might help boost automobile sales. Attempts are also being made to boost tourism and infrastructure spending in the UAE, which bodes well for stimulating consumer confidence further in the country. These efforts, along with the UAE’s continued push to raise investment in the non-oil economy, is likely to help consumer confidence in the upcoming months. In both Saudi Arabia and the UAE, the prospects for consumer-centric businesses are likely to persist.

In Pakistan, consumer confidence has reached an all-time high of 115, following an 8-point increase. Consumers in Pakistan are increasingly optimistic about job prospects and their personal financial situation. However, it is uncertain whether the high level of confidence can be sustained in the future. Pakistan’s new government is likely to approach IMF for assistance to address the country’s worsening external balance, which might lead to signifi-cant fiscal and monetary tightening. This, along with rising consumer prices, will pose major challenges to consumer confidence post-election.

Other countries, including Morocco and South Africa, still have low confidence levels, but given the fact that these economies have significant growth potential, their consumer markets are only likely to expand further.



Latin America

Confidence declines in half the region—pessimism over jobs and spending persist


GLOBAL CONSUMER CONFIDENCE INDEX FOR LATIN AMERICA, Q2 2018: 86

Chile91

Venezuela67

Peru90

Mexico96

Costa Rica87

Colombia101

Brazil81

Argentina76

GLOBAL CONSUMER CONFIDENCE INDEX FOR LATIN AMERICA, Q2 2018: 86

56 127

Q2 2018

Q1 2018

PT CHG

Latin America 86 88 -2

Colombia 101 99 2Mexico 96 93 3Chile 91 95 -4Peru 90 95 -5Costa Rica 87 83 4Brazil 81 88 -7Argentina 76 83 -7Venezuela 67 57 10

Consumer confidence in Latin America declined by 3 points in the second quarter of 2018, ending its recent upward trend. Confidence gains in Venezuela, Costa Rica, Mexico, and Colombia were not enough to offset the declines in the region’s larger countries, Argentina, Brazil, Peru, and Chile. Argentina, Brazil, Peru, and Chile together constitute about 60 percent of Latin America’s GDP and population, so declines in those countries do not bode well for the region. Pessimism over job prospects, spending intensity, and even the future of the economy persist across Latin America. Job prospects and spending intentions appear to be the major factors driving down consumer sentiment in Latin America, with job prospects being a major concern for a large portion of consumers in every country. Overall, Latin American countries have a diverse set of issues, including political and economic uncertainty, unemployment, inflation, and low economic growth, potentially posing more challenges to businesses in the region in the short to medium term.

• After a 1-point increase in the first quarter, confidence declined by 2 points in the second quarter to 86 points.

• Confidence declined considerably in Argentina, Brazil, Peru, and Chile, while improving in Colombia, Mexico, Costa Rica, and Venezuela.

• Argentina’s drop of 7 points is among the top-five largest declines globally. In contrast, Latin America’s most troubled economy, Venezuela, was among the top-five increases. Even so, Venezuelans’ confidence remains abysmally low.

• Concerns about job prospects in next 12 months, the state of the economy, and spending intentions are persistent across Latin America.



Brazil, Latin America’s largest economy, is struggling to sustain its economic recovery, and consumers’ confidence is in decline. Despite low inflation rates, high unemployment has translated into increased pessimism about job prospects—77 percent of respondents consider job prospects not so good, up from 67 percent in the last quarter. In addition, 87 percent of consumers feel Brazil is still in recession, and more than half of consumers do not believe that the recession will be over in the next 12 months. The increasing economic and political uncertainty in Brazil, driven by tightening global financial conditions, increases in oil prices, and its upcoming national election are likely to worsen consumer sentiment in the coming months.

Latin American countries have a diverse set of issues, including political and economic uncertainty, unemployment, inflation, and low economic growth, which pose more challenges to businesses in the region in the short to medium term.

In Argentina, high inflation and unemployment combined with a weak economy, are all negatively impacting consumer confidence. This country’s recent pledge to IMF to initiate tough reforms and fiscal consolidation will have a short-term negative impact on growth, which might further worsen consumer sentiment. The decline in Chile’s consumer confi-dence is possibly driven by concern about job prospects, despite solid economic growth and moderate inflationary pressure in the first quarter of this year. Job security, crime, and debt top the list of concerns in Chile, and in contrast to all other Latin American economies, the economy is not a top concern.

Surprisingly, in Venezuela, despite the political turmoil, accelerated sanctions from the United States and depressed oil production, consumers’ optimism improved, resulting in an increase in consumer confidence of 10 points to 67 in Q2 2018. Despite the large increase, Venezuela still has the lowest confidence level in Latin America. The gain in Mexico’s consumer confidence is likely to continue, as the political uncertainty in the country has eased following July’s general election. Yet, the uncertainty about NAFTA renegotiations will remain a drag on Mexico’s economic and consumer outlook.

Latin America



North America

Confidence remained stable in Q2 but optimism over job prospects declines


GLOBAL CONSUMER CONFIDENCE INDEX FOR NORTH AMERICA, Q2 2018: 121

Canada102

US123

GLOBAL CONSUMER CONFIDENCE INDEX FOR NORTH AMERICA, Q2 2018: 121

56 127

Q2 2018

Q1 2018

PT CHG

North America 121 121 0

US 123 123 0Canada 102 103 -1

After reaching a historically high level of confidence at 121 in the first quarter of 2018, North American consumers’ sentiment seems to have plateaued. Whereas consumer confi-dence declined marginally by 1 point in Canada in the second quarter of 2018, it remained unchanged in the US—thus keeping the region strong and stable.

• Consumer Confidence in North America remained unchanged, maintaining its all-time high of 121.

• Consumer confidence decreased marginally by 1-point in Canada and was unchanged in the United States.

• Confidence in Canada is lower than in the United States and other large advanced economies like Germany and is likely to be affected by escalating global trade tensions.

• Consumers in the region remain optimistic about job prospects, though sentiment regarding job prospects has declined marginally.

• Concern over the economy has climbed to the top of consumers’ list of concerns, up from fifth place in the last quarter when it was still behind personal health, debt terrorism, and job security.

Consumers’ assessment of job prospects declined marginally compared to the last quarter, yet overall they remain optimistic about job prospects for next 12 months. Compared to the previous quarter, consumers concerns have shifted. Whereas the top concerns in the first quarter were health, debt, and job security, concerns about the economy became most prevalent on consumers’ list of concerns during the second quarter. Recession concerns are not persistent in the region, and the share of respondents who think the country is in recession remained the same at only 35 percent.



Concern over job prospects remained largely unchanged in the US in the second quarter, and the overall balance is still positive with 67 percent of respondents thinking that job prospects are good compared to 27 percent who think otherwise. Consumers’ assessment of their current personal financial situation improved marginally, and their spending inten-tions, which compares their personal financial situation and current market conditions, did not change. While the economy tops the list of concerns among US consumers, recessionary worries were low, suggesting that strong economic and job growth in the US will continue to support strong confidence readings. The levelling off in overall confidence index suggests consumers do not foresee growth accelerating in the coming months. However, this is not necessarily worrisome for businesses, as the level of confidence remains high compared to historic levels, and when compared to other countries—both within emerging and advanced economies.1

In general, consumer confidence in Canada is lower than in large advanced economies such as the US and Germany and several emerging ones, yet it is higher compared to levels prior to the global recession in 2008–2009. Perceptions about job prospects and consumers’ personal financial situations declined marginally. Spending intentions have declined slightly more, perhaps due to rising inflation: the average inflation rate for the first five months of 2018 has been half a percent higher than the average for 2017; and interest rates. While inflation would hamper consumers’ purchasing power directly, higher interest rates would potentially raise the cost of debt—both developments would be bad for consumers’ discre-tionary spending.2

High confidence levels in the US and Canada should continue to support consumer spending in the upcoming months.

High confidence levels in the US and Canada should continue to support consumer spending in the upcoming months. Yet, a shift in US trade policy could increase concerns among consumers, as the onset of import tariffs would escalate domestic prices in the US. If the import tariffs raise prices, and if businesses pass on the increase to consumers, it is quite likely that consumers will cut back on their discretionary purchases. Also, a retaliation to US tariff policies from trading partners such as China, Canada, Mexico, and Europe would hamper the US economy, which could also affect consumer sentiment in the future. The trade war would escalate anxiety in Canada´s economic growth as well, which relies quite heavily on exports to the United States. The resulting uncertainty amid rising inflation and high borrowing costs could negatively impact consumer confidence in Canada.

1 The quarterly US data shown here are based on The Conference Board® Global Consumer Confidence Survey and are included to enable country/regional comparisons. These data and methodology differ from the Consumer Confidence Survey® and Consumer Confidence Index® which are published monthly by The Conference Board. For more information, see: https://www.conference-board.org/data/consumerconfidence.cfm

2 The quarterly data for Canada shown here are based on The Conference Board® Global Consumer Confidence Survey and are included to enable country/regional comparisons. These data and methodology differ from the Index of Consumer Confidence, which are published monthly by The Conference Board of Canada. For more information, see: https://www.conferenceboard.ca/topics/economics/Consumer_confidence.aspx

North America



Turkey88

Sweden99

Slovenia87

Slovakia93

Russia70

Russia70

Portugal85

Norway92

Netherlands106

Kazakhstan84

Israel102

Hungary80

Finland83

Czech Republic108

Croatia79

Belgium91

Austria101

Ukraine62

UK101

Switzerland99

Spain92

Serbia75

Romania92

Poland105

Lithuania78

Latvia80

Italy62

Ireland108

Greece67

Germany107

France78

Estonia88

Denmark118

Bulgaria85

Belarus67

GLOBAL CONSUMER CONFIDENCE INDEX FOR EUROPE, Q2 2018: 87

56 127

GLOBAL CONSUMER CONFIDENCE INDEX FOR EUROPE, Q2 2018: 87

Europe is one of the two regions that showed a modest improvement in consumer confi-dence (the other was Middle East & Africa). The aggregate improvement masks differences across countries, but overall, confidence in the region remains much lower than other regions of the globe. Long-term challenges to strengthen the buoyancy of its consumers relative to other regions remain.

Improving yet low levels of confidence suggest a moderation in Europe’s consumer market, though some markets remain favorable. Economies in several countries including Germany, UK, Poland, the Netherlands, Czech Republic, and smaller ones like Denmark, Ireland, and Austria are among Europe’s hotspots which offer relatively stronger consumer markets. Also, several European economies—both east and west—show an improving trend, which is a promising signal.

Part of the drag on the European confidence level was driven by Russia, which accounts for 17 percent of the region’s population. In addition, several populous countries such as Italy and France, and several Eastern European economies, also have low levels of confidence. And finally, Germany, the largest economy in the region, showed a modest decline in consumer confidence, though from a much higher level than most other European economies.

Europe


Confidence improved slightly in Q2, but most consumers believe recessionary conditions will continue

Q2 2018

Q1 2018

PT CHG

Europe 87 86 1

Denmark 118 114 4Czech Republic

108 108 0

Ireland 108 103 5Germany 107 108 -1Netherlands 106 101 5Poland 105 103 2Israel 102 105 -3

Q2 2018

Q1 2018

PT CHG

Austria 101 100 1UK 101 96 5Sweden 99 99 0Switzerland 99 104 -5Slovakia 93 90 3Norway 92 89 3Romania 92 91 1Spain 92 91 1Belgium 91 88 3

Q2 2018

Q1 2018

PT CHG

Estonia 88 81 7Turkey 88 89 -1Slovenia 87 81 6Bulgaria 85 81 4Portugal 85 90 -5Kazakhstan 84 79 5Finland 83 82 1Hungary 80 78 2Latvia 80 86 -6

Q2 2018

Q1 2018

PT CHG

Croatia 79 77 2France 78 79 -1Lithuania 78 77 1Serbia 75 74 1Russia 70 68 2Belarus 67 60 7Greece 67 61 6Italy 62 66 -4Ukraine 62 58 4



• Europe’s confidence level increased slightly by 1 point from 86 to 87 in the second quarter, recouping the loss from the first quarter. The increase was primarily driven by a small decline in the pessimism over job prospects.

• On average, Europeans’ perceptions on job prospects, personal finances, and spending are unchanged from the previous quarter, but pessimists continue to outweigh optimists.

• Despite improved conditions in the past two years, consumers in nearly half of the European economies currently believe that their country is in recession, and most believe these recessionary conditions will continue in the next 12 months.

• The economy has now moved up to first place in consumer’s list of concerns, up from third position last quarter.

• The Netherlands, the UK, and Greece all posted significant gains in confidence, suggesting an improving consumer outlook.

• Of the 34 European economies, 8 countries showed declines, which included three of the largest economies in the regions, namely Italy, France, and Germany.

European perceptions about personal financial situations, spending, and the state of the economy did not change significantly compared to the previous quarter. In general, the percentage of pessimistic consumers outweigh the percentage of optimistic ones on all these aspects. Nevertheless, a modest decline in the share of negative perceptions on job prospects helped create a marginal gain in overall confidence.

In the Netherlands, the consistent decline in the unemployment rate, resulting in a tight-ening labor market, moderate inflation, and gradually increasing wages has supported consumer sentiment. In the UK, general optimism among British consumers has improved, though marginally, on all fronts—job prospects, personal finances, and the economy. This echoes the momentum in second quarter GDP growth and improvement in job growth, which is probably part of the long wave of the strong European economy during 2017. It is uncertain, however, whether the momentum in jobs, which are mostly part-time jobs, will be sufficient to sustain improvements in confidence levels and offset an increasingly uncertain political and economic environment as Brexit negotiations continue. The Conference Board Leading Economic Index®(LEI) for the UK is increasingly pointing in the direction of an upcoming recession. In Greece, consumers seem to have been influenced by the slow increases in prices, improving economy, and still high but declining unemployment rates. The recent EU agreement to extend debt relief might further help to buoy sentiment in the coming months.

Confidence declined in 8 out of 34 European countries. Larger Western European economies such as France and Germany experienced marginal declines in consumer confidence, while Israel, and politically unsettled Turkey saw somewhat larger decreases. Declines in Latvia, Portugal, Switzerland, and Italy were more pronounced.

While the share of consumers who are positive on the three consumer-related questions—job prospects, personal finances, and spending intentions—remains high in Germany, which helps its consumer confidence stay above 100, it is not the case in Europe’s two other large economies, Italy and France. Positive sentiments on job prospects declined in France and Italy, and perceptions of personal finances and spending intentions declined in Germany

Europe



and Italy; thus, the overall index declined everywhere. Rising concerns about unemployment amid fears of a slowing recovery in France seem to have translated into less optimism about job prospects compared to the previous quarter. The Conference Board Global Economic Outlook forecasts 0.2 percentage point lower growth in France in 2018 compared to 2017. In Italy, persistently high levels of unemployment at about 11 percent, gradually increasing prices, uncertainty regarding economic policy, and political stability could all be nega-tively impacting sentiment. At the time of this survey, the political deadlock in Italy was still persistent, which might have figured in consumers’ evaluations. Economic recovery in Italy has also lost its momentum, with signals suggesting further slowing in Q2. If unemployment remains high and prices continue to rise, Italy will struggle to boost confidence in the next quarters. The political and economic environment in Turkey is also worsening and is not conducive to improving confidence in the short term.

The trend in regional consumer confidence suggests a moderation in Europe’s consumer market, though some markets including Germany, UK, Poland, the Netherlands, Czech Republic, Denmark, Ireland, and Austria remain favorable.

Personal finances are perceived to be an issue by consumers in Western European economies such as Finland, France, Greece, Italy, and Norway; in Eastern European countries such as Belarus, Hungary, Kazakhstan, Lithuania, Portugal, Serbia, and Ukraine; and in Russia and Turkey. All the above mentioned Western European economies, except Norway, also expressed concerns about job prospects. In Eastern Europe, consumers in all countries except in Poland expressed pessimism over job prospects, despite low and decreasing unemployment rates and sustained wage growth.

In 15 of 34 European countries, consumers are concerned about the current state of the economy, with a relatively large portion—varying from 53 percent in Bulgaria, Hungary, and Latvia to 92 percent in Ukraine—saying their country is currently in recession. Even more pronounced is the concern over the future of the economy, which is quite pessimistic across Europe. The Czech Republic is an exception, where the optimism and pessimism on the future of the economy are somewhat evenly balanced. In general, with a low unemployment rate, consumers in this country are quite optimistic on all other aspects—the current state of the economy, employment prospects, and personal finances—and maintain a high level of confidence at 108.

Consumers’ top concerns for the region over the next six months have shifted somewhat since last quarter. Now, the economy, health, and job security are cited as top concerns, compared to last quarter when the economy was third after job security and health.

Europe



Global Consumer Confidence Index by Region and Country

Q2 2018

Q1 2018

Point Change

Global Consumer Confidence Index 104 106 -2

Asia‑Pacific 112 115 ‑3

Australia 93 91 2

China 113 115 -2

Hong Kong 105 107 -2

India 124 130 -6

Indonesia 127 127 0

Japan 83 86 -3

Malaysia 117 104 13

New Zealand 102 104 -2

Philippines 127 128 -1

Singapore 94 97 -3

South Korea 56 59 -3

Taiwan 76 79 -3

Thailand 102 110 -8

Vietnam 120 124 -4

Africa & The Middle East 93 91 2

Egypt 80 85 -5

Morocco 70 67 3

Pakistan 115 107 8

Saudi Arabia 107 95 12

South Africa 90 95 -5

UAE 116 110 6

Latin America 86 88 ‑2

Argentina 76 83 -7

Brazil 81 88 -7

Chile 91 95 -4

Colombia 101 99 2

Costa Rica 87 83 4

Mexico 96 93 3

Peru 90 95 -5

Venezuela 67 57 10

North America 121 121 0

Canada 102 103 -1

US 123 123 0

Q2 2018

Q1 2018

Point Change

Europe 87 86 1

Austria 101 100 1

Belarus 67 60 7

Belgium 91 88 3

Bulgaria 85 81 4

Croatia 79 77 2

Czech Republic 108 108 0

Denmark 118 114 4

Estonia 88 81 7

Finland 83 82 1

France 78 79 -1

Germany 107 108 -1

Greece 67 61 6

Hungary 80 78 2

Ireland 108 103 5

Israel 102 105 -3

Italy 62 66 -4

Kazakhstan 84 79 5

Latvia 80 86 -6

Lithuania 78 77 1

Netherlands 106 101 5

Norway 92 89 3

Poland 105 103 2

Portugal 85 90 -5

Romania 92 91 1

Russia 70 68 2

Serbia 75 74 1

Slovakia 93 90 3

Slovenia 87 81 6

Spain 92 91 1

Sweden 99 99 0

Switzerland 99 104 -5

Turkey 88 89 -1

UK 101 96 5

Ukraine 62 58 4



Copyright © 2018 The Conference Board, Inc. All rights reserved.

About The Conference Board® Global Consumer Confidence SurveyThe Conference Board® Global Consumer Confidence Survey is conducted in collaboration with Nielsen. It was conducted in February 2018 and polled more than 32,000 online consumers in 64 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample includes internet users who agreed to participate in this survey and has quotas based on age and gender for each country. It is weighted to be representative of internet consumers by country. Because the sample is based on those who agreed to participate, no estimates of theoretical sampling error can be calculated. However, a probability sample of equivalent size would have a margin of error of ±0.6% at the global level. This survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. The Conference Board uses a minimum reporting standard of 60% internet penetration or an online population of 10 million for survey inclusion. The Nielsen China Consumer Confidence Index is sourced from a separate survey conducted by Nielsen China, which is based on a mixed methodology survey of more than 2,400 respondents in China. The Global Consumer Confidence Survey was established in 2005.

About The Conference BoardThe Conference Board is a global, independent business membership and research association working in the public interest. Our mission is unique: to provide the world’s leading organizations with the practical knowledge they need to improve their performance and better serve society. Winner of the Consensus Economics 2016 Forecast Accuracy Award (US), The Conference Board is a non-advocacy, not-for-profit entity, holding 501(c)(3) tax-exempt status in the USA.


About NielsenNielsen Holdings plc (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers Watch and Buy. Nielsen’s Watch segment provides media and advertising clients with Total Audience measurement services across all devices where content—video, audio and text—is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry’s only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen provides its clients with both world-class measurement as well as analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90% of the world’s population. For more information, visit http://www.nielsen.com

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