Peru: Consumer confidence hits three-year high
October 28, 2010
The consumer confidence index (INDICCA) published by APOYO Consultoria inched up from 54 points in September to 55 points in October, which marked the highest level in consumer sentiment since May 2007. At the current level, consumer confidence is above the 50-point threshold that separates optimism from pessimism. The positive reading in consumer sentiment reflects consumers' optimistic assessment about the current economic situation and future economic prospects. Confidence increased in particular among respondents in the lower socio-economic levels, which have observed a pick-up in the pace of employment growth. The increase in consumer confidence also reflected a higher number of consumers expecting lower inflation, with only 10% of respondents expecting inflation to accelerate for the next 12 months. As a result, more households are planning to make home improvements and to buy major durable goods, suggesting that domestic demand will remain a strong growth driver in the year ahead.
Author: Ricardo Aceves, Senior Economist