JOHANNESBURG – The FNB/BER Consumer Confidence Index (CCI) remained unchanged in the fourth quarter of 2019, after having plunged from +5 index points during the second quarter of 2019 to -7 during the third quarter.
Bolstered by hopes that President Ramaphosa would be quick to root out corruption and stimulate economic growth, consumer confidence held firm, trading between +2 and +5, during the first half of 2019, despite a significant further deterioration in South Africa's economic fundamentals.
According to the FNB/BER CCI report released on Tuesday, at -7 index points, consumer confidence was only one point north of the -8 recorded in the fourth quarter of 2017 – just before Ramaphosa’s election as national president – and also well below the long-run average reading for the CCI of +2 since 1994.
This strongly suggests that the confidence gains since Ramaphosa’s election have now been completely reversed and South Africa’s grim economic reality has become apparent to consumers.
“With economic growth floundering around 0.5 percent year on year since mid-2018 and the debilitating risk that Eskom’s electricity supply and financial problems pose to the domestic economy, it is not surprising that consumers are now also distressed about South Africa's economic prospects,” reads the report.