Consumer Confidence Index

Details: Created: 24 May 2016

In April 2016, the consumer confidence index (CCI) continued to increase, sustaining the trend which started in January. From an economic perspective, the lari’s appreciation (from 2.32 to 2.23 GEL/USD) was one of the most important visible developments in April. Furthermore, with Easter celebrations underway, many stores offered discounts on a variety of consumer items. This helped position April as a good time for major purchases in the minds of consumers. Lastly, the pre-election period has started, affecting the expectations component of the index.

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Details: Created: 05 May 2016

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In March 2016, the consumer confidence index (CCI) continued the increasing trend that started in October 2015. The index gained 8.6 points compared to the historic low of September 2015. Although an upward trend is clearly visible, the current CCI is still some 30.4 points adrift of the highest point seen in November 2013. Some of the factors behind the increase in March were the appreciation of the lari against the U.S. dollar, a decrease in food prices and a good winter tourism season. Interestingly, the largest improvement of the CCI was observed for respondents aged below 35, signaling that recent proactive government measures to improve the business climate may have influenced people’s perceptions.

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Details: Created: 23 February 2016

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The customer confidence index rebounded in February 2016 after a sharp fall in January. The government’s more active involvement in the regions, primarily through agricultural programs, seem to have borne fruit. The two most notable of such programs are “Plant the Future”, which provides subsidies for farmers willing to invest in orchards, and the subsidies offered to farmers for plowing. Although the CCI for Tbilisi continued to decrease in February, Georgia’s regions drove the overall improvement in the country-wide index.

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CCI Methodology

The ISET Consumer Confidence Survey follows the standard EU methodology (see Useful Links): we randomly sample 300-350 individuals on a monthly basis and question them about the past, current and future financial situation of their families and the country as a whole.Consumer confidence is the degree of optimism that consumers feel about the overall state of the economy and their personal financial situation. How confident people feel about stability of their incomes determines their spending activity and therefore serves as one of the key indicators for the overall shape of the economy. In essence, if consumer confidence is higher, consumers are making more purchases, boosting the economic expansion. On the other hand, if confidence is lower, consumers tend to save more than they spend, prompting the contraction of the economy. A month-to-month diminishing trend in consumer confidence suggests that in the current state of the economy most consumers have a negative outlook on their ability to find and retain good jobs. Read more