Consumer confidence slumped to its worst levels in 35 years, during the second quarter of 2020 as households grappled with the economic fallout of the phased lockdown restrictions, imposed to slow the spread of the coronavirus.FNB/BER consumer confidence index plummeted to -33, a low not seen since 1985 when then president PW Botha delivered his Rubicon speech amid resistance to the apartheid regime and the gauge hit -36, the bank said in a statement about the data.
The decline in consumer sentiment was in part due to steep falls in the household finances and time-to-buy durable goods sub-indices. “The sharp deterioration in the financial prospects index of the CCI and the complete collapse in the time-to-buy durable goods index suggest that the Covid-19 pandemic and ensuing economic restrictions had a materially negative impact on both consumers’ ability and willingness to spend,” FNB chief economist Mamello Matikinca-Ngwenya said.
“Unlike affluent households, low-income ones typically have little savings to fall back on during times of financial hardship and therefore experienced a fairly immediate and significant deterioration in their quality of life when the lockdown commenced,” said Matikinca-Ngwenya
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