U.S. Consumer Confidence Now Lower Than At Height Of Global Recession

LONDON (Susan Fenton) - Global consumer confidence fell in the second quarter to its lowest level in a year and a half as an uncertain economic outlook, a deepening euro zone debt crisis and rising inflation made people more cautious, a survey showed on Sunday.

Consumer sentiment in the United States was weaker than in the second half of 2009 at the height of the global recession, according to The Nielsen Company's quarterly survey of global consumers.

Globally, consumers plan to tighten their belts in coming months for everything from stock investing to buying clothes, taking holidays and upgrading technology, after being slightly less cautious over the past 12 months, the survey showed.

Thirty one percent of U.S. consumers said they have no spare cash for discretionary spending, along with 25 percent of consumers in the Middle East and Africa and 22 percent of Europeans.

Confidence dipped in China, due to rising inflation, as well as in the Middle East where an initial bounce in consumer morale after social uprisings in the first quarter gave way to caution as the political outlook became unclear and rising prices curbed spending power. Egypt and Saudi Arabia posted the biggest falls from the first quarter in Nielsen's ranking of confidence in 56 countries worldwide.

Confidence was lowest in euro zone countries engulfed by a deepening debt crisis with Greece coming bottom of the global ranking. Portugal, Ireland, Spain and Italy were also in the bottom 10 although while confidence fell from the first quarter in Spain and Italy it rose slightly in Portugal and Ireland.

Indian consumers were still the most bullish globally but less so than in the first quarter. Consumers in Asia generally remained much more optimistic than in other regions -- with the notable exception of the Japanese and South Koreans who were among the most pessimistic globally -- but rising inflation tempered Asian purchasing power.

India's score in the Nielsen Global Consumer Confidence Index fell 5 points from the previous quarter to 126. It was well below the country's record 137 index reading in the second half of 2006, the highest reading for any country in the index's six-year history.

The index's global average reading dipped 3 points from the first quarter to 89, its lowest since the fourth quarter of 2009.

A score below 100 signals pessimism about the outlook.

"Weak economic figures, slowing manufacturing performance and inflation in Asia, an intensifying debt crisis in Europe and continuing political instability in the Middle East, combined with rising household expenses in the U.S., have taken their toll on consumers' fragile confidence," said Venkatesh Bala, chief economist at The Cambridge Group, a unit of Nielsen.

"Hopes for full global recovery in the next 12 months substantially weakened in the second quarter as the majority of consumers around the world remained in a recessionary mindset."

Todd Hale, a senior vice-president at Nielsen in the United States, said U.S. consumers had been knocked by a series of negative factors.

"With rapidly rising gas prices, inflationary pressures at check-out, continued woes in the housing market with home foreclosures and declining property values, unsettling weather patterns creating flooding and tornado damage, and a stagnant job market, confidence among U.S. consumers fell in the second quarter," Hale said.

The UK and France, in contrast, saw a bounce in confidence in the second quarter although the level of morale in both countries remained below the European average.

The survey was taken between May 20 and June 7, covering 31,000 consumers in 56 countries. The survey is based on consumers' confidence in the job market, status of their personal finances and readiness to spend.

Nielsen Global Consumer Confidence Index in the second quarter, 2011 (Change from Q1, 2011 survey in brackets):

Top 10 index readings Bottom 10 index readings

India 126 (-5) Ireland 64 (+3)

Philippines 115 (+5) Spain/Lithuania 60 (-1,-3)

Indonesia 112 (-4) Latvia 57 (0)

Malaysia/UAE 110 (+5,+1) Italy/Japan 55(-2,0)

Switzerland 108 (-2) S.Korea 52 (+1)

Saudi Arabia/Hong Kong 107 (-11,0) Romania 47 (+1)

China/Thailand 105 (-3,-1) Croatia 45 (-2)

Australia/Singapore 103 (-7,-6) Hungary 43 (+2)

Canada 101 (-1) Portugal 42 (+3)

Peru 99 (0) Greece 41 (-4)

--------------------------------------------------------------

Global consumer confidence average 89 (-3)

United States 78 (-5)

Germany 88 (-4)

UK 72 (+5)

France 69 (+8)

Source: The Nielsen Company

(Editing by Toby Chopra)

Copyright 2011 Thomson Reuters. Click for Restrictions.

Comments

[kizzie]

04:39 AM on 07/20/2011

NYTimes--Weds morning 7/20/2011
- BUSINESS -
U.S. to Close 800 Computer Data Centers
Analysts estimate that thousands of jobs will be eliminated
with the federal government's plan to shut 40 percent of
its computer centers over the next four years.
======================

As one example, he pointed to the Web site Healthcare.gov. It enables people to compare health insurance coverage and pricing options offered by private companies and the government, and to compare quality scores for hospitals and nursing homes, based on government data.

The shift to modernized computer services has already started. For example, nearly 140,000 employees at the General Services Administration and Department of Agriculture have moved to cloud-based e-mail, Mr. Kundra said, saving about $42 million a year. Google provides the cloud e-mail for the G.S.A, while a Microsoft cloud service is used by the Agriculture Department.

Mr. Kundra declined to estimate the job impact of eliminating hundreds of data centers. The closings are determined by technology managers in the federal agencies. Data centers are not huge employers, as military bases are, for example. Yet even in the first wave of closings, Mr. Kundra said, “We have had some pushback from members of Congress, but tough decisions have to be made.”

[Y3rMawm]

02:03 AM on 07/19/2011

The misconception being the we have already reached the pinnacle of recession formerly known as TGD 2.0. Nothing is predetermined, of course.

[womenforaction]

05:32 PM on 07/18/2011

Do you know why India has the highest index reading?

India's economy is split in two, the manufacturing and IT sector.

"there have been an astonishing number of software and call-centre jobs that have been created in the last 10 years and the industry has grown faster than any other in the history of the country"

And guess where they are getting their IT jobs or software and call-centre jobs?
The lovely United States of America.
Let's just give our country or American corporations an applause for giving another country a big fat boost in their economy. We should be proud.

[kenyng1st]

03:03 PM on 07/21/2011

We ended the Shuttle program, laid off thousands of American workers, now Russia will handle transportation to and from the Space Station.

Even the American Government is exporting American Jobs!!

[Timma]

01:18 PM on 07/18/2011

Anybody who believes we aren't in the midst of class warfare has'nt been paying attention. The banksters have been allowed to define new norms for working America. And they will continue to define it down as long as they are allowed to. There is no such thing as "Jobless Recovery." Economic recovery implies decrease in unemployment more than in rising stock prices. Any lack of enthusiasm by American workers should be taken as a big clue that the economy has not recovered. Not as an indicator that working Americans are apathetic sad or lack optimism. Workers are the nation's economic backbone.

[kriskrinkel]

12:31 PM on 07/18/2011

its the ob ama effect now taking hold of the USA....the only people that have confidence are those taking govt handouts...thanks od umbo

[xpt2wndj]

10:34 AM on 07/18/2011

Thanks for all the failed policies BO.
Your BIG government policies stink.
The recession will be over when you are gone.
"Hoax and Chains"

[coliwabl]

10:12 AM on 07/18/2011

What can be expected when we are dealing with the most sinister group of politicians known as Republicans and the Tea Party. They seem excited about artificially bringing the country to the brink of disaster. They are nothing but a bunch of self-centered, criminal minded hypocrites that should all be charge with and tried for treason. After that, all their assets should be liquidated and returned to the government to help pay off the very debt they created.

[kenyng1st]

01:14 PM on 07/18/2011

Taliban/Tea Party one in tha same. Osama is striking from within.

[xpt2wndj]

09:17 AM on 07/18/2011

What do you expect when we have such a weak leader. Empty suit politics isn't a winning strategy.
BO's policies are Un-American, Stealing from those that earned the money to give to those that haven't earned it is........ UN-American.

[smo1111]

09:01 AM on 07/18/2011

Republicans were elected to the House.................consumer confidence, the stock market, and the economy stall.

[castlerider]

08:02 AM on 07/18/2011

Lower confidence, of course. A direct result of a Republican controlled Congress that allows nothing to get done.

The party of NO. It's like a virus, that makes everything sick and unconfident.

Republicans suck.

[InLosAngeles]

07:42 PM on 07/18/2011

Hmmm. When did the Democrats grab control of Congress and thus the purse strings of the nation. When was that again?

[castlerider]

01:27 AM on 07/19/2011

Democratic congress got OVER 240 bills passed, I believe it was in the 4 years they controlled Congress... I believe GOPers have done about 12 so far, the 2 years they've been in.
And Pursestrings??? it wasn't nothing compared to the GOPers had from 2002 to 2006, spending money lik eit had no end.

Howcome you GOPers always need history lessons?.

[IMissAmerica]

07:49 AM on 07/18/2011

That's because now we are in what will fondly be referred back to as "The Bush-caused Depression"

[StevieRay HoneyBadger]

06:11 AM on 07/18/2011

Not to worry folks, the recession is over. Obama said so.

[Kev Bat]

07:31 AM on 07/18/2011

Bush didn't even tell us for a year that a recession had started .

[OldTulsan]

08:54 AM on 07/18/2011

The announcement of the end of the recession first came from the NBER.

http://www.nber.org/cycles/sept2010.html
Business Cycle Dating Committee, National Bureau of Economic Research

"...In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity..."

[AlanBannacheck]

03:23 AM on 07/18/2011

Of course consumer (we have all gone from human beings to consumers worldwide) "confidence" (How does one accurately measure confidence in individuals, let alone society?), unemployment is up as well as gas prices and this is beginning to look eerily familiar...

[Brandon26pdx]

02:22 AM on 07/18/2011

The real economy has been in a lull at best, and in full-on disaster mode at worst really since the housing bubble imploded, which was what? 2006 or 2007? Consumers are just accepting that exuberance is long gone and that a steady stream of bad news is going to be the norm for quite awhile yet, especially if policy makers can't pull their head out.

[ibsteve2u]

03:18 AM on 07/18/2011

Most people don't understand that the housing bubble was accelerated - if not launched - in the first half of 2002 by Bush's Administration (http://archives.hud.gov/remarks/martinez/speeches/presremarks.cfm) not only to divert a whole lot of wealth to Wall Street and the banks but also to conceal the punishment our economy was already taking from "flood-up/trickle-down" economics, deregulation, and - particularly - inequitable free trade.

The housing bubble was an artificial "lull"...cover and concealment for the destruction of America from within...all to further enrich the few and break American "labor" - a.k.a. the American people.

[steama]

01:53 AM on 07/18/2011

The middle class know the jobs are not coming back. In fact the wealthy citizens that the GOP loves to coddle, the ones that are the so called job creators, use the money they received during this crisis to do more work with LESS people and NOT to hire more fellow Americans. Like it or not this is our capitalism at work for YOU.