AUGUST 2016: END SUMMER BLUES

In August 2016, the consumer confidence turned towards the negative compared to the previous month.

This decline was observed for almost all questions, except the questions related to the current personal financial position and the readiness to save. The question related to expected major purchases within the next 12 months experienced the biggest decrease.

Most important CCI developments:

The share of respondents who think that they will reduce major purchases within the following months increased from 56.8% in July to 68.7% in August;
In July, 8.9% of respondents expected the prices to increase more rapidly, 17% to increase at the same rate and 17% to increase at a lower rate compared to the last 12 months. In August, these numbers had changed to 6.0%, 21.0% and 20.6%, respectively;
Significant decreases in overall CCI (by more than 5 points) were observed in the following four areas: expected financial situation of the households over the next 12 months, current general economic situation in the country, and readiness to save (intentions and capacity);
A moderate increase, by 3.2 points, was observed in the question that relates to the current financial situation of households. The share of respondents who think that their financial situation has improved over the past 12 months increased from 15.1% to 18.7% in August, compared to July.

The overall CCI has decreased for people with all education levels, all age groups, and for both males and females. For all categories the drop in expectations was higher compared to the drop in the perception of the present situation.

Sub-Group	Present Situatuation	Expectations	Overal CCI
AGE
35 and below	-35.5 (down by 4.4 points)	-19.7 (down by 8.6 points)	-27.6 (down by 6.5 point)
Over 35	-36.5 (down by 1.6 point)	-22.2 (down by 5.4 points)	-29.4 (down by 3.5 points)
GENDER
Male	-34.3 (down by 5.3 points)	-21.1 (down by 7.2 points)	-27.7 (down by 6.2 point)
Female	-37.6 (down by 0.2 points)	-21.5 (down by 5.9 points)	-29.6 (down by 3.0 points)
EDUCATION
Higher education	-29.5 (down by 3.7 point)	-20.1 (down by 9.4 points)	-24.8 (down by 6.5 points)
The rest	-42.7 (down by 3.3 points)	-22.5 (down by 4.5 points)	-32.6 (down by 3.9 points))

REGIONAL PECULIARITIES

In August, the overall consumer confidence index modestly decreased in both Tbilisi and the rest of Georgia and both local indices converged to each other, as the overall index lost 5.4 points in Tbilisi, while in rest of Georgia it lost only 4 points.

	Tbilisi	Rest of Georgia (RoG)
Overall CCI	-29.5 (down by 5.4 points)	-28.2 (down by 4.0 points)
Present Situation Index	-36.3 (down by 5.4 points)	-36.1 (down by 1.0 points)
Expectations Index	-22.8 (down by 5.5 points)	-20.4 (down by 7.0 points)
Expectations-Present Gap	13.5 points	15.6 points

The most important factors for the change of the CCI in Tbilisi were questions regarding the current environment for major purchases and purchasing intentions for the next 12 months. As for the rest of Georgia, the change in the index was also driven by forward-looking purchasing intentions but also by expectations about changes in the future financial position of the household.