Consumer Confidence Index Plummets Post-Eid, Entrepreneurs Remain Optimistic
Monday, 10 June 2024
The business community believes that the Consumer Confidence Index (CCI), which weakened in May 2024, still reflects economic activity as it remains at an optimistic level.
The Chairperson of the Indonesian Employers Association (Apindo), Shinta Widjaja Kamdani, views the decline in the CCI post-Eid as normal. She refers to historical CCI data from previous years, which also showed a decline after Eid.
"From our perspective, the decline in the CCI in May 2024 is still very supportive of the government's targeted economic growth of 5%, as the decline is relatively mild," said Shinta when contacted on Monday (10/6/2024).
According to her, overall, the index level from Bank Indonesia's survey results is still very solid at an expansive level. However, she acknowledges concerns about the income expectations index, which has decreased compared to Ramadan and Eid, driven by the impact of the Eid bonuses (THR).
On the other hand, the high interest rates on credit have also eroded consumption of durable goods in the community, Shinta noted. "Therefore, we need to continuously monitor whether this index decline can be interpreted as a significant decrease in purchasing power that could disrupt potential business expansion," she said.
The consistency of government policies supporting business certainty is considered crucial for business expansion in the real sector amid the current government transition. With policies favoring the business and investment climate, Shinta stated, the performance of the real sector will continue to grow positively, contributing to increased employment, income, and purchasing power.
Previously, Bank Indonesia (BI) noted that consumer optimism towards economic conditions decreased post-Eid al-Fitr 2024.
The Assistant Governor and Head of the Communications Department at BI stated that this condition is reflected in the Consumer Confidence Index (CCI) for May 2024, which was 125.2, remaining at an optimistic level (>100). The CCI for May 2024 experienced a decline compared to the previous month, which was 127.7. The Current Economic Condition Index (IKE) and the Consumer Expectations Index (IEK) for May 2024 were recorded at 115.4 and 135.0, respectively, down from 119.4 and 136.0.
Meanwhile, the Job Availability Index and the Durable Goods Purchase Index remained in the optimistic area, at 113.6 and 112.7, respectively. Furthermore, the IEK is mainly supported by income expectations at 139.0, while expectations for job availability and business activities also remained in the optimistic zone at 134.5 and 131.6, respectively.
Source : https://ekonomi.bisnis.com/read/20240610/12/1772845/indeks-keyakinan-konsumen-anjlok-pasca-lebaran-pengusaha-masih-optimistis
