Significant increase in Hong Kong consumer confidence compared with first quarter, but still third-lowest since the launch of the index

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The latest survey from City University of Hong Kong (CityU) shows that in the second quarter of 2020, the Consumer Confidence Index (CCI) for Hong Kong was 66.2, up 19.7% quarter on quarter (QoQ), but down 14.8% year on year (YoY). The second quarter’s CCI was the third-lowest since the index was introduced in the third quarter of 2008.

In addition, results of the six sub-indices were lower than 82 despite the fact that they have all gone up, showing that Hong Kong consumers lack confidence in all areas measured.

The survey was conducted by the Statistical Consulting Unit of the Department of Management Sciences at CityU, which forms part of the CCI in the cross-strait region, Hong Kong and Macau.

Significant increase in consumer confidence in four areas compared with first quarter

There was significant QoQ increase in confidence in four areas: stock investment, living standards, property purchases and commodity prices. 

The sub-index for stock investment was 65 (Table 1), marking a significant YoY decrease of 15.7%, but a dramatic increase of 30% QoQ. The present confidence level was 63.5 (Table 2), a dramatic 31.5% rise QoQ. The confidence level for the coming three months was 66 (Table 2), a huge increase of 29.2% QoQ. This indicates that consumer confidence in this area has increased considerably. 

The sub-index of living standards measured 81.8 (Table 1), a significant YoY decrease of 17.5%, but a considerable increase of 24.9% QoQ. This remains the area in which Hong Kong people are most confident. The current figure was 88.3 (Table 2), a dramatic increases of 40.6% QoQ. Their confidence in living standards for the next three months was 77.4 (Table 2), a significant 15% increase QoQ. However, the absolute value of the future sub-index was low, indicating that confidence remains low among local consumers.

The overall sub-index of 58.7 (Table 1) shows that Hong Kong residents continue to have the lowest confidence in property purchases. The index saw a significant YoY increase of 14.9% and a significant QoQ increase of 20.3%. The figure for current property purchases was 57.2 (Table 2), a significant QoQ increase of 15.6%; and local confidence in property purchases for the next three months was 59.7 (Table 2), a considerably increase of 23.6% QoQ. This sub-index rose QoQ, but it is still the area in which Hong Kong consumers have the lowest confidence of the six areas.

The overall commodity price sub-index was 70.1 (Table 1), a slight YoY increase of 3.7%, but a significant QoQ increase of 19.6%. The current sub-index for commodity prices was 64.5 (Table 2), a dramatic increase of 36.4% QoQ; and the figure for the next three months was 73.9 (Table 2), a significant 11.8% increase QoQ, indicating that Hong Kong consumer confidence in commodity prices has risen, but is still weak.

The overall index figures in the other two areas have also increased

The sub-index of Hong Kong people's confidence in employment was 60.3 (Table 1), a dramatic YoY decline of 34.4%, but a significant increase of 13.1% QoQ. The figure for the present employment situation was 47.2 (Table 2), a decline of 5.6% QoQ; while the index for confidence in employment for the next three months was 69 (Table 2), a huge increase of 24.3% QoQ, indicating that local confidence in the employment situation has improved. The absolute value of the present and future sub-index was low, however, showing that consumers continue to worry about the employment situation.

The sub-index of Hong Kong residents' confidence in economic development was 61.1 (Table 1), a huge YoY decrease of 22.9%, but a QoQ increase of 9.5%. The figure for the present economic situation was 48.2 (Table 2), a significant decline of 12% QoQ; while the figure for economic confidence in the next three months was 69.7 (Table 2), a huge increase of 23.6% QoQ. However, the absolute value of the sub-index was low, indicating that Hong Kong consumers are worried about the economic situation.

The overall findings rose significantly QoQ, indicating an increase in consumer confidence in all areas. In particular, the sub-indices for stock investments, living standards and property purchases increased significantly by more than 20%. However, the figure in the second quarter was the third lowest since this index was introduced in the third quarter of 2008, and close to the fourth lowest figure of 68.7 measured in the fourth quarter of 2019,  indicating that Hong Kong consumer confidence is still very low, likely the result of continuing concern about the COVID-19 pandemic.
 

About the Consumer Confidence Index in the cross-strait region, Hong Kong and Macau

Notes for Data Collection
City University of Hong Kong is responsible for the data collection for the captioned investigation. The CCI survey for the second quarter of 2020 was conducted by telephone interview from 10 to 30 June 2020. A random-sampling procedure was used, with 1,001 interviews conducted with local residents aged 18 or above. The survey has a 95% confidence level, and the sampling error is plus or minus 1.5 percentage points.

Notes for the Consumer Confidence Index
The Consumer Confidence Index was launched in the first quarter of 2009 and has been released on a quarterly basis since then. The overall consumer confidence score is an integrated index, measuring consumer confidence in economic development, employment, commodity prices, standard of living, property purchases and stock investments. It reflects the confidence level of consumers in Mainland China, Hong Kong, Macau and Taiwan. The index is jointly compiled by Capital University of Economics and Business, the Central University of Finance and Economics, City University of Hong Kong, Macau University of Science and Technology, and Taipei Medical University.

The Chinese Consumer Confidence Index uses a scale of 0 to 200, with 0 representing “no confidence” and 200 representing “complete confidence”. If the index is below 100, it suggests consumers “lack confidence”, while if it is above 100, it suggests “relative confidence”.

Media enquiries
Dr Geoffrey Tso Kwok-fai
Associate Head, Associate Professor and Director of the Statistical Consulting Unit
Department of Management Sciences            
City University of Hong Kong
Tel: (852) 3442 8568 or (852) 9020 9996

Mr Hu Yijian
Research assistant 
Department of Management Sciences
City University of Hong Kong
Tel: (852) 3442 8657 or (852) 6990 6084

Table 1. Results of the CCI Index

Table 2. Results of the CCI Index

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