Johannesburg - Consumer confidence declined during the
fourth quarter of 2012, First National Bank and the Bureau for Economic
Research's Consumer Confidence Index (CCI) reported on Tuesday.
It declined by two index points from -1 to -3.
This meant consumers' rating of the outlook for the national
economy and whether this was the right time to buy durable goods, had notably
deteriorated during the fourth quarter.
However, consumers' rating of their own financial prospects
remained largely unchanged.
Ratings were at levels last witnessed at the onset of the
global financial crisis in the second half of 2008. "With the average
reading for the CCI at +6 since 1994, the latest reading of -3 implies that
consumer confidence is low and not supportive of strong growth in consumer
spending," the organisations said.
It was at a high of +15 when South Africa hosted the Soccer
World Cup, and had already touched -3 this year during an "alarming
escalation" in the eurozone debt crisis.
They said that coupled with rising inflation and a
deterioration in the outlook for household income growth, low consumer
confidence levels foreshadowed subdued growth in household consumption
expenditure during 2013.
The CCI combines the results of three questions posed to
adults in South Africa between October 24 and November 9 2012. The latest was
done before the De Doorns farmworkers' strike.
Respondents were asked about the expected performance of the
economy, the expected financial position of households, and the rating of the
appropriateness of the present time to buy durable goods, such as furniture,
appliances and electronic equipment.
"Given the adverse implications of the violent strikes
in the mining, transport and now also agricultural sectors for fixed investment
and job creation in South Africa, it is not surprising that consumers are
becoming increasingly concerned about the outlook for the domestic
economy," said Cees Bruggemans, FNB consulting economist.
"The decline in the index since the beginning of the
year indicates that consumers are becoming more cautious about purchasing
durable goods, which correlates with the deceleration in sales growth reported
by retailers in furniture and household appliances since the end of 2011,"
The conclusion drawn from the study was that "economic
conditions in the eurozone remain tenuous, while the escalation in domestic
political tensions and spate of violent wildcat strikes have dented South
Africa's fixed investment and general economic growth prospects".