July 19, 2011
Local consumers less optimistic in Economy, Employment, and Regular Income; with a gloomy outlook towards Quality of Life
Hong Kong, July 19 2011 – Consumer confidence in Hong Kong has dipped over the last six months, according to the latest MasterCard Worldwide IndexTM of Consumer Confidence, released today. Though consumers remain cautiously optimistic with an overall Index score of 69.9, the latest Index score for Hong Kong is lower than previous surveys conducted six months (74.7) and a year ago (76.6) respectively.
Hong Kong respondents feel less optimistic in their expectations of the Economy (69.4 vs. 77.9 six months ago), Employment (71.5 vs. 80.4) and Regular Income (81.4 vs. 83.2). Their confidence in Quality of Life even fell from a positive 57.7 in the previous six months to a pessimistic 49.9. However, they seem more confident in the Stock Market as it is the only indicator that increased slightly (77.6 vs. 74.1).
Amongst the Hong Kong respondents, those under the age of 30 are more optimistic than their older counterparts (71.2 for those below 30 vs. 68.9 for those above 30). These results mark a dramatic reversal compared to six months ago when the consumer sentiment of those aged 30 and above was more positive than those who were younger (75.9 vs. 71.4).
Now in its 19th year, the MasterCard Worldwide Index of Consumer Confidence is the region’s most comprehensive and longest running consumer confidence survey. The Index is based on a survey which measures consumer confidence on prevailing expectations in the market for the next six months based on five economic indicators: Economy, Employment, Stock Market, Regular Income and Quality of Life. The Index score is calculated with zero as the most pessimistic, 100 as most optimistic and 50 as neutral.
The latest survey was conducted from 15 March to 27 April 2011 and involved 10,374 consumers from 14 markets. Data collection was via internet surveys, personal, telephone and Computer Aided Telephone interviews, with the questionnaire translated to the local language wherever appropriate and necessary. The Index and its accompanying reports do not represent MasterCard financial performance.
“Though Hong Kong records a decline in optimism, consumer attitudes remain positive. There is clearly a perception that the recovery from the financial crisis is not going as smoothly as people would like,” said Jeroen van Son, Head of Hong Kong and Macau, MasterCard Worldwide.
“Local consumers are still wary in their outlook for the months ahead due to the uncertainties caused by issues such as rising commodity and property prices, natural disasters and political instability in other markets and ongoing financial uncertainty across the Eurozone. Nevertheless, it is encouraging to see that consumer perceptions across most of the indicators continue to be optimistic.”
In Asia/Pacific, consumers are concerned at the slow pace of the global economic recovery with a dip in optimism recorded over the last six months (61.5 vs. 68.0). Ten out of the 14 Asia/Pacific markets, such as China, Hong Kong and Singapore, recorded an overall decline in consumer confidence. Japan and New Zealand, both still recovering from devastating earthquakes this year, were the least confident nations. Taiwan is one of only four markets that saw consumer sentiment moved upwards.
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The MasterCard Worldwide Index™ of Consumer Confidence survey has a 19-year track record of consumer confidence indices collected from over 200,000 interviews, unequalled both in scope and history across Asia/Pacific.
The MasterCard Worldwide Index of Consumer Confidence is the most comprehensive and longest running survey of its kind in the region. In June 1997, the Index revealed a decline in consumer confidence – one month prior to the devaluation of the Thai baht that triggered the regional economic crisis. In June 2003, the Index score for Employment in Hong Kong dropped to a low of 20.0. This was subsequently reflected in Hong Kong’s unemployment rate, which peaked just before September 2003 at eight percent.
The survey comprising the Asia/Pacific markets began in the first half of 1993 and has been conducted twice yearly since. Markets from the Middle East and Africa were included in the Index from 2004. Twenty five markets now participate in the survey: Australia, China, Egypt, Hong Kong, India, Indonesia, Japan, Kenya, Kuwait, Lebanon, Malaysia, Morocco, New Zealand, Nigeria, Oman, Philippines, Qatar, Saudi Arabia, South Korea, South Africa, Singapore, Taiwan, Thailand, United Arab Emirates and Vietnam. The last MasterCard Worldwide Index of Consumer Confidence survey was conducted from 15 March to 27 April 2011. A total of 17,620 qualified respondents were surveyed in the 25 markets with the sample being representative of the middle and upper income groups in each market. In each market except China and India, 400 or more people were surveyed. A minimum sample size of 800 was collected from China and India.
The Index is calculated based with zero as the most pessimistic, 100 as most optimistic and 50 as neutral. Five economic factors are measured: Employment, the Economy, Regular Income, Stock Market and Quality of Life. The responses are consumers' thoughts on the six months ahead. Data collection was via internet surveys, personal, telephone and Computer Aided Telephone interviews, with the questionnaire translated to the local language wherever appropriate and necessary. The survey has a margin of sampling error of plus or minus four percentage points at the 90 percent confidence level, except China and India where because of the larger sample, the margin of sampling error is plus or minus three percentage points.
The MasterCard Worldwide Index suite in Asia/Pacific, Middle East and Africa includes the long-running MasterCard Worldwide Index of Consumer Confidence, as well as the MasterCard Worldwide Index of Women’s Advancement, Online Shopping, Index of Financial Literacy, and the Index of Global Destination Cities. In addition to the Indices, MasterCard’s research properties also include a range of consumer surveys including Ethical Spending and a series on Consumer Purchasing Priorities (covering Travel, Dining & Entertainment, Education, Money Management, Luxury and General Shopping).
MasterCard also regularly releases Insights reports providing analysis of business dynamics, financial policies and regulatory activities in the Asia/Pacific, Middle East and Africa region. Over 80 Insights reports have been produced since 2004.
MasterCard has also released a series of four books on Asian consumer insights, authored by Dr. Yuwa Hedrick-Wong, Global Economic Advisor for MasterCard Worldwide and published by John Wiley & Sons.
MasterCard (NYSE: MA), www.mastercard.com, is a technology company in the global payments industry. We operate the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone. Follow us on Twitter @MasterCardNews, join the discussion on the Cashless Conversations Blog and subscribe for the latest news.