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Philippine consumer confidence weakens slightly in Q3

Consumer outlook in the Philippines slightly weakened in in the third quarter of 2013, results of the Consumer Expectations Survey conducted by the Bangko Sentral ng Pilipinas (BSP) showed.

The poll conducted from 1-12 July 2013, however, reavealed that consumer confidence during the quarter registered the second highest reading since the nationwide survey started in the first quarter 2007.

The Philippines’ Central Bank said the reasons cited by respondents for the decline in consumer confidence were low income due to factors such as poor harvests, no permanent work and downturn of businesses; more unemployed persons; and higher household expenditures.

BSP, however, sees consumer confidence returning to favorable levels in the next quarter in anticipation of the availability of more jobs as well as more working family members, increased investments, additional incomes, and monetary benefits (bonuses) during the holiday season.

"For the next quarter, consumers were more upbeat on their family finances as respondents expected to receive their holiday bonuses/13th month pay, while their outlook on the country’s economic condition was broadly steady," the BSP said.

By income group, weaker consumer sentiment was observed among the middle-and high-income groups in Q3, while the outlook of respondents from the low-income group remained steady on their family finances but turned pessimistic with respect to their views about the country’s economy.

Despite the weaker current quarter sentiment, more respondents considered the current quarter as a favorable time to buy big-ticket items such as consumer durables, motor vehicles and housing. Meanwhile, buying intentions remained broadly steady for the year ahead.

Consumers also anticipated that the peso would continue to appreciate against the US dollar in the next 12 months in line with expectations of continued inflows of foreign investments and sustained overseas Filipino (OF) remittances.