Hong Kong consumer confidence has decreased, with the largest decrease in the Property Purchases sub-index

The Consumer Confidence Index (CCI) of the cross-strait region, Hong Kong and Macau for the first quarter of 2021 was announced on 8 April. The overall CCI for Hong Kong is 62.4, down 2.7% quarter on quarter, but up 12.8% year on year (YoY). Almost all of the sub-indices recorded a decrease during the quarter, but the largest decrease, about 16%, is in the Property Purchases sub-index. All the scores are lower than 77, indicating that Hong Kong consumers have not regained confidence in any of these aspects.

Decrease in consumer confidence in four main aspects

There were decreases in confidence levels in four main aspects: Property Purchases, Commodity Prices, Stock Investments and Employment.

The overall sub-index of Property Purchases measures at 52.7 (Table 1), a significant decrease of 16.2% compared with the last quarter. The result for current property purchases is 52.5 (Table 2), and significantly decreases by 16.1% when compared with the last quarter.  Confidence in property purchases for the coming three months is 52.8 (Table 2), a considerable decrease of 16.3% from the last quarter. It is the aspect in which Hong Kong consumers have the lowest confidence.

The overall commodity price sub-index is 65.3 (Table 1), a significant YoY increase of 11.4%, but a decrease of 3.1% compared to the last quarter. The current sub-index of commodity prices is 62.6 (Table 2), a slight decrease of 1.1% when compared with the former quarter. The result for the coming three months is 67.1 (Table 2), decreasing by 4.3% from the last quarter, indicating that Hong Kong consumer confidence in commodity prices has decreased and remains weak.

The overall sub-index for Stock Investments is 60.8 (Table 1), a considerably YoY rise of 21.6% but a slight decline of 2.7% when compared with the previous quarter. The result for the present situation is 57.8 (Table 2), down 5.6% from the previous quarter. The confidence level for the coming three months is 62.8 (Table 2), which is almost unchanged compared to the former quarter. However, the absolute value of the sub-index is low, which demonstrates a lack of confidence in stock investment among Hong Kong people.

The overall sub-index of Hong Kong people towards Employment is 58.1 (Table 1), a significant YoY increase of 9% but a slight decrease of 1.4% compared with the result of last quarter. The result for the present employment situation is 43.1 (Table 2), a considerable decline of 21.1% from the previous quarter. The index for employment confidence in the coming three months is 68.1 (Table 2), with a significant increase of 10.2% when compared with the previous quarter. The absolute value of the sub-index is low, showing that the consumers continue to be concerned about employment.

Rising confidence in Economic Development and Standard of Living

There were increases in confidence levels in two main aspects: Economic Development and Standard of Living.

The overall sub-index of Hong Kong residents towards Economic Development is 60.9 (Table 1), a considerable YoY increase of 9.1% and an increase of 3.4% when compared with the previous quarter. The result for the present economic situation is 48.6 (Table 2), with a decline of 9.3% compared to the last quarter in this aspect. The result for the economic confidence in the coming three months is 69.1 (Table 2), with a significant increase of 10.6% compared with the previous quarter. The absolute value of the sub-index is low, demonstrating that Hong Kong residents are still concerned about the economic situation.

The Standard of Living sub-index measures at 76.6 (Table 1), up 3.2% from the previous quarter and a significant YoY increase of 16.9%, which is the highest level of confidence among the six aspects. The result for the current situation is 81.6 (Table 2), an increase of 7.5% compared with the last quarter. Their confidence index in living standard for the coming three months is 73.2 (Table 2), almost unchanged when compared with the last quarter. Although there is an increase in this confidence level, the absolute value of the future sub-index is still low, indicating that local consumers have not regained confidence.

The overall result is lower than that of the last quarter, because of a decrease in consumer confidence in the Property Purchases, Commodity Prices, Stock Investments and Employment sub-indices. Among these indices, the sub-index for Property Purchases decreased significantly by about 16%. The absolute values of the sub-indices are low, showing that Hong Kong consumers lack confidence, and are most concerned about property purchases in the future, possibly because of the on-going pandemic situation in the past few months.

 

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

 

Appendix A: Notes for Data Collection

City University of Hong Kong is responsible for the data collection for the captioned investigation. The CCI survey in first quarter of 2021 was conducted by telephone interview from 7 to 31 March 2021. A random sampling procedure was adopted, and 1,011 interviews were conducted with local residents aged 18 or above. The survey results have a 95% confidence level, and the sampling error is plus or minus 1.5 percentage points.

 

Appendix B: Notes for the Chinese Consumer Confidence Index

The Chinese 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 sentiment about 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, 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”.

 

Appendix C: Tables

Table 1. CCI Index Scores (Overall*)

*The overall index is a weighted index that combines the present and expected CCI.