Abuja, Nigeria. July 25th, 2017 – The Portfolio of Indices report released by NOIPolls for Q2, 2017 revealed that the NOIPolls Consumer Confidence Index (CCI) stood at 64.8-points in Q2 2017; this represents a slight increase of 2.1-points when compared with 62.7-points obtained in Q1, 2017. The Consumer Confidence Index reveals consumers’ tendencies to spend, which is directly proportional to their expectations for a general improvement in the country’s economic conditions, employment opportunities, personal financial strength and stability in the prices of goods and services. This slight leap in the confidence of consumers in Nigeria could have influenced their propensity to purchase with a degree of optimism about the overall state of the economy. This optimism could be linked to some improvements in policies in recent times which has propelled the nation’s economy into the path of recovery in Q2, 2017, although, in a slow pace. Some of the policies include improvement in foreign exchange, Ease of Doing Business, the Executive Orders, amongst others according to The Business Confidence Monitor (BCM) that was released recently by the Nigerian Economic Summit Group (NESG).
In addition, there are two variables that make up the CCI; the Present Situation Index (PSI) and the Expectation Index (EI). The PSI and the EI both experienced an increase of 3.8-points and 0.9-point respectively when compared to the result obtained in Q1, 2017. These are the key highlights from the Q2, 2017 Portfolio of Indices Press Release.
In February 2014, NOIPolls introduced its portfolio of indices; the NOIPolls Personal Well-Being Index (PWBI), the NOIPolls Consumer Confidence Index (CCI) and the NOIPolls Eagle 30 Business Confidence Index (EBCI). The NOIPolls Personal Well-Being Index measures factors impacting on the lives of everyday Nigerians; thereby producing a complete view of the individual’s personal well-being. The NOIPolls Consumer Confidence Index provides consumer assessments of the economic situation and their intentions and expectations for the future. The NOIPolls Eagle 30 Business Confidence Index measures business leaders’ perceptions and expectations about the Nigerian business environment using the top 30 companies in the country.
Nigerian businesses, financial and government agencies largely depend on their perceptions and micro assessment of consumers’ expectation in making decisions. At best, they draw conclusions on the business environment based on information from their immediate surroundings while the minorities conduct surveys that are time and money consuming. However, the introduction of these indices provides indicators that will ensure stakeholders can detect and respond to changes in consumer behaviour, the economy, and the business environment in Nigeria.
This report presents the Q2, 2017 results for the NOIPolls Consumer Confidence Index (CCI).
THE NOIPOLLS CONSUMER CONFIDENCE INDEX (CCI)
The NOIPolls Consumer Confidence Index (CCI) in Q2, 2017, experienced an increase of 2.1-points to stand at 64.8-points. This indicates a slight increase in confidence among consumers in the country, propelled by assurance in their financial stance in relation to the expectation of the country’s economic situation, and it could be used by stakeholders to obtain qualitative information on key leading economic indicators such as investment, prices, demand conditions, employment etc. to make informed decisions.
The 2 independent variables that consist of the NOIPolls Consumer Confidence Index; the Present Situation Index (PSI) and Expectation Index (EI) both experienced an increase in Q2, 2017. The PSI increased with 3.8-points from 34.3-points in Q1, 2017 to stand at 38.1-points in Q2, 2017, while the EI also increased with 0.9-point from 84.0-points in Q1, 2017 to stand at 84.9-points in Q2, 2017. The PSI measures general consumer thoughts in relation to the present economic situation, while the EI evaluates the overall consumer sentiments toward the short-term future economic situation.
The PSI and the EI are made up of a total of 7 variables and all these variables experienced an increase except the Expected Total Family Income Index which experienced a decline while the Expected Employment Condition Index remained the same. These are highlighted below.
Current Economic Situation Index–42.2
The Current Economic Situation Index increased from 39.5-points in Q1, 2017 to 42.2-points in Q2, 2017. Although this index experienced an increase of 2.7-points, it still indicates that consumers are somewhat not satisfied with the country’s Current Economic Situation.
Expectation of the Country’s Economic Situation Index –94.4
The Expectation of the Country’s Economic situation index is one of the highest indices and it increased by 0.9-point from 93.5-points obtained in Q1, 2017 to stand at 94.4-points. This portrays a high optimism about the improvement in the country’s economic situation.
Current Employment Condition Index – 53.4
The Current Employment Condition improved from the average (50-points) position in Q1, 2017 to stand at 53.4-points in Q2, 2017 representing a significant 3.4-points increase.
Expected Employment Condition Index – 98.4
The Expected Employment Condition Index remained the same (98.4-points) as the result obtained in Q1, 2017, signifying that Nigerians are still optimistic in terms of their expected employment condition.
Current Prices of Goods and Services Index – 18.8
The Current Prices of Goods and Services Index experienced the highest increase of 5.3-points in this quarter to stand at 18.8-points from 13.5-points recorded in Q1, 2017. Though, it remained the lowest index, the increase observed in Q2, 2017 revealed negativity in the country’s market developments, meaning thatprices of goods and services are increasing.
Expectation of Prices of Goods and Services Index – 79.58
The Expectation of Prices of Goods and Services Index increased by 3.6-points from 76-points in Q1, 2017 to stand at 79.6-points in Q2, 2017 and this shows that consumers are optimistic that there will be a reduction in prices of the goods and services in the future.
Expected Total Family Income Index – 67.1
The Expected Total Family Income Index is the only variable that experienced a decline of 0.8-point to stand at 67.1-points. This assumes that consumers are, to some degree, sceptical about their expected total family income which is capable of weakening the spending powers of consumers.
Trend analysis showed that the PSI increased by 3.8-points to stand at 38.1-points in Q2, 2017, while the EI also increased by 0.9-point to stand at 84.9-points in Q2, 2017. The increase experienced by these 2 components influenced the increase in the overall CCI.
In conclusion, the NOIPolls Consumer Confidence Index increased by 2.1-points to stand at 64.8-points. Correspondingly, the two independent variables that make up the CCI, the Present Situation Index (PSI) and the Expectation Index (EI) both experienced an increase of 3.8-points and 0.9-point respectively in Q2, 2017. This slight increase infers that consumers’ confidence is gradually improving and this may have been driven by improved efficiency in economic management of the country. Therefore, the Federal Government should do its best at sustaining its effort to ease the business environment, make credit available to the real sector and to also continue and intensify its ongoing quest to diversify the economy beyond relying on oil exports so as to stimulate more economic activities in the country.
The Consumer Confidence Index Poll was conducted in Quarter 2, 2017. The CCI involved telephone interviews of a random nationwide sample. 3,000 randomly selected phone-owning Nigerians aged 18 years and above, representing the six geopolitical zones in the country, were interviewed. With a sample of this size, we can say with 95% confidence that the results obtained are statistically precise - within a range of plus or minus 3%. NOIPolls Limited, No1 for country specific polling services in West Africa. We conduct periodic opinion polls and studies on various socio-economic and political issues in Nigeria. More information is available at www.noi-polls.com or you can download our mobile app NOIPolls on your smartphone.
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NOIPolls hereby certifies that all the views expressed in this document accurately reflect its views of respondents surveyed for the poll, and background information is based on information from various sources that it believes are reliable; however, no representation is made that it is accurate or complete. Whilst reasonable care has been taken in preparing this document, no responsibility or liability is accepted for errors or fact or for any views expressed herein by NOIPolls for actions taken as a result of information provided in this report. Any ratings, forecasts, estimates, opinions or views herein constitute a judgment as at the date of this document. If the date of this document is not current, the views and content may not reflect NOIPolls’ current findings and/or thinking.