Consumer Confidence Improves in Q4 2024, Q1 2025 and the Next 12 Months

The consumer sentiment for Q4 2024 improved as the overall confidence index (CI) turned less negative at -11.1 percent from -15.6 percent in Q3 2024.

The latest data indicated a combined increase in the percentage of optimists and a decrease in the percentage of pessimists.

Respondents attributed their less pessimistic sentiment for Q4 2024 to expectations of: (a) higher and additional sources of income, (b) more working family members, and (c) more available jobs and permanent employment.

For the next quarter (Q1 2025) and the next 12 months (November 2024 to October 2025), consumer confidence also improved. The more upbeat outlook of consumers for both periods was attributed to expectations of: (a) higher income, (b) additional sources of income, and (c) more available jobs.

For Q4 2024, consumer sentiment improved across all component indicators and income groups. The consumer confidence across the three component indicators (i.e., country’s economic condition, family’s financial situation, and family income), and across all income groups (i.e., low-income, middle-income, and high-income groups) was less pessimistic for Q4 2024.

Consumers are less hesitant about buying big-ticket items in Q4 2024. The consumer sentiment on buying big-ticket items for Q4 2024 was less pessimistic as the CI turned less negative at -67.3 percent from -68.9 percent in Q3 2024.

The percentage of households with savings declines, while those with loans was unchanged in Q4 2024. The percentage of households with savings declined to 25.6 percent in Q4 2024 from 29.0 percent in Q3 2024.

Meanwhile, around 25.5 percent of households availed of a loan in the last 12 months, unchanged from Q3 2024.

Consumers expect higher interest rates, a weaker peso, and a higher unemployment rate for all reference periods. Consumers anticipate that interest rates may increase and the peso may depreciate against the US dollar for Q4 2024, Q1 2025, and the next 12 months.

Furthermore, households expect that the unemployment rate may increase across all reference periods. Households expect that the inflation rate may increase in the near term and over the next 12 months.

However, the percentage of respondents who expect higher inflation declined compared with the Q3 2024 survey results.

Specifically, consumers expect that the inflation rate may average 6.2 percent for the next 12 months, which is above the National Government’s inflation target range of 2.0 to 4.0 percent for 2024-2025.

View Full Report here: https://www.bsp.gov.ph/Lists/Consumer Expectation Report/Attachments/23/CES_4qtr2024.pdf

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The Q4 2024 CES was conducted from 4 – 16 October 2024. In the Q4 2024 CES, 5,470 households were identified as eligible, with 2,817 (51.5 percent) from the NCR and 2,653 (48.5 percent) from AONCR. Of the identified sample size, 5,350 households participated in the survey, equivalent to a response rate of 97.8 percent (up from 97.7 percent in the Q3 2024 survey). Respondents included 2,757 households in the NCR (with a 97.9 percent response rate) and 2,593 households in AONCR (with a 97.7 percent response rate). The high-income group comprised the largest percentage of respondents (42.2 percent), followed by the middle-income group (35.6 percent) and the low-income group (22.2 percent).