Asia Pacific markets bounce back as consumer confidence rises: MasterCard Index

Nine out of 14 regional markets showing improved confidence across five key economic indicators led by Hong Kong, South Korea and Malaysia

Consumer confidence has picked up across Asia/Pacific markets as concerns about slow growth lessen in the region, according to the latest MasterCard Worldwide IndexTM of Consumer Confidence, released recently.

The MasterCard Worldwide IndexTM of Consumer Confidence (“Index”) is based on a survey conducted between 24 April 2012 and 10 June 2012 on 11,376 respondents aged 18 – 64 in 25 countries within Asia/Pacific, Middle East and Africa. This is the 39th survey of consumer confidence conducted since 1993. Now in its 20th year the Index is Asia/Pacific’s most comprehensive and longest running consumer confidence survey. The Index score is calculated with zero as the most pessimistic, 100 as most optimistic and 50 as neutral. The Index and its accompanying reports do not represent MasterCard’s financial perf    ormance.

Consumers in the region remain most optimistic in the markets of India (82.1 Index points), China (77.4), Vietnam (77.2) and Thailand (75.8), while the least optimistic markets are Japan (23.6), Taiwan (25.7) and Australia (39.2).

Overall, nine out of 14 Asia/Pacific[1] markets polled recorded positive improvements when compared to the second half of 2011 with a regional rise from 52.1 Index points in the second half of 2011 to 57.2 Index points in the first half of 2012. The last MasterCard Index of Consumer Confidence showed an improvement in sentiment for only five out of the 14 markets. For the region as a whole increases were recorded across all key indicators of regular income (from 64.5 to 71.9 Index points), employment (49.3 to 54.0 Index points), economy (49.3 to 51.8 Index points), quality of life (49.6 to 51.7 Index points) and stock market (47.9 to 56.5 Index points).

Hong Kong, which dropped 38.7 Index points in the last Index, improved by 21.9 Index points to lead the region, followed closely by South Korea (up 21.4 Index points), Malaysia (up 17.1 Index points) and New Zealand (up 15.3 Index points).

Indonesia recorded the single largest deterioration in consumer confidence (down 18.7 Index points) followed by the Philippines (down 11.8 Index points). Consumer confidence in the economy plummeted in Indonesia (from 74.9 to 33.3 Index Points), with employment also falling from 70.6 to 40.8 Index Points.

 “The latest reading of consumer confidence in Asia/Pacific reflects the increasingly complex mix of key influences affecting the region. The first is the global environment, which continues to be weak and riddled with uncertainty, especially in Europe. The second is the slowdown in China, which has been affecting many key regional markets that are China-centric in their exports. The third is the strength of the domestic markets in sustaining growth with home-grown demand.

While the global environment affects all markets in Asia/Pacific, the slowdown in China has had more severe impact on Australia, Japan, South Korea and Taiwan. On the other hand, Vietnam has been a major beneficiary of low end manufacturing relocating from China in the recent past. India, being the least dependent on either global or China demand, is by far the most domestic oriented among the key markets in the region. It’s relative optimism reflects the perception that the economy has become more stable after growth declining for two years,” said Dr. Yuwa Hedrick-Wong, global economic advisor, MasterCard Worldwide.