• Fall in Future Expectations hits sentiment
• Sentiment still in line with average since series began in 2007
The MNI China Consumer Indicator fell in January from an 18-month high in December, ending a run of five consecutive monthly rises, led by a decline in consumers’ expectations for the future.
The Consumer Indicator fell to 95.1 in January from 97.5 in December, the lowest reading since September. The latest drop left sentiment bang in-line with the average of the series since it began in 2007 and a little above the 94.1 average recorded in 2013.
Both current conditions and future expectations deteriorated in January, with the latter leading the decline. Expectations fell as sentiment about future personal finances and business conditions declined.
The Employment Indicator fell sharply in January from an 18-month high in December.
In line with the slowdown in inflation to a one and a half year low, our survey participants were less dissatisfied about the current level of prices in January than in December.
Commenting on the data, Chief Economist for MNI Indicators Philip Uglow said:
“Consumer sentiment finally turned down in January following gains since the summer of 2013. Confidence, though, still remains at a relatively high level and well above the low seen a few years ago.
“The question now is whether consumer confidence can be maintained with growth at a lower, more sustainable, level. Concerns over excessive debt and possible default on investment trust products have the potential to spook consumers over the coming months.”