Consumer confidence collapses due to coronavirus crisis

The rapid deterioration of the country’s economic situation, as a result of the coronavirus crisis, has consumers at the most pessimistic levels since there is a record and only comparable to the consequences of the social crisis of last October.

According to the Consumer Perception Index (Ipeco)) developed by the University of Development Studies Center (UDD), in April consumer confidence fell 18.6 points, remaining at the “extraordinarily pessimistic” level, reaching 49.6 points, his second worst record since the 48 points he scored last December.

The biggest difference, yes, between what was experienced in the last months of last year and what is recorded now, is that in April there is also a sharp deterioration in the current situation, added to the impact on the evaluation of the future. , which became evident after 18-O.

Thus, confidence at present (conjunctural index) decreased sharply (74.5 points), reaching 32.8 points, going from the moderately pessimistic level to the extraordinarily pessimistic one. For its part, confidence in the future (expectations index) increased marginally (1.7 points), although it also remained at an extremely pessimistic level.

In the detail of the conjunctural index, it is seen that the perception of the current economic situation decreased by 82.8 points, to 29.7 points, going from the slightly pessimistic level to the extraordinarily pessimistic one, due to an increase in pessimistic views and a decrease of neutral and optimistic visions. This level is, by far, the lowest for this variable, since this study began in December 2001.

On the other hand, the perception of current unemployment decreased by 59.3 points, to 40.1, going from the pessimistic level to the very pessimistic one. This is the lowest level of this variable since February 2016, and it is part of a labor scenario that has been increasing layoffs, reducing new job offers and cutting thousands of jobs due to the pandemic. The perception of employment is also in line with the increase in people who are leaving the workforce, but who would immediately return knowing that they will have a job. These “discouraged” rose 63% in the last year, according to figures from the INE’s Employment survey.

Future. The perception of the future economic situation advanced 13.2 points, although remaining at an extraordinarily pessimistic level. This slight advance may be related to market expectations, which see that next year there would be a strong rebound in the economy, after the drop expected this year.

However, according to respondents, these expectations would not automatically translate into an equal improvement in the employment scenario. In fact, the perception of future unemployment fell 19.9 points, going from the very pessimistic level to the extraordinarily pessimistic one.