Consumer confidence on the up and up, says survey

The Jakarta Post, Jakarta

Indonesian consumer confidence continued to improve in the fourth quarter of last year, Australian research firm Roy Morgan said Tuesday in its latest survey report.

The consumer confidence rating for the October-December period moved upward by another 3.2 points to 113.6, which means it is now 8.4 higher than for the same period a year earlier, said a statement by the research firm.

Looking ahead, about 38 percent of the surveyed respondents said they expected to be financially better off within the next 12 months, with only 9 percent expecting otherwise.

Roy Morgan interviewed 6,297 respondents aged 14 and over during the October-December 2006 period.

On longer-term expectations, the survey found that 82 percent of respondents expected good financial conditions over the next five years, with 18 percent expecting bad economic conditions.

"The continuing buoyancy in Consumer Confidence should mark the end of the crisis triggered by the fuel price hikes in 2005. The recovery is well and truly on the way," said Ira Soekirman, director of Roy Morgan Research Indonesia.

"Interestingly, the middle class, comprising both men and women, are more confident that the affluent elite. The main drivers of the rating's march forward are their faith in Indonesia's economic prospects in the year ahead as well as the recovery in demand for major household appliances."

Twenty percent of respondents said it was a good time to purchase major household items, while 69 percent considered it to be a bad time to buy.

Indonesia's macroeconomic indicators are improving on easing inflation, a stable rupiah and a declining trend in Bank Indonesia's key interest rate.

On Tuesday, the central bank cut its benchmark interest rate to a 19-month low of 9 percent, the tenth cut since May last year, as inflation weathered the effects of the floods earlier in February.
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