OREANDA-NEWS. August 20, 2012. Decrease of consumer confidence of Ukrainians was observed in July. The July consumer confidence index (CCI) is 81.1 which is 3 p. lower than in June.

The deterioration was caused by all the index components except the evaluation of current personal financial standing along with better inflationary expectations. This is proved by the consumer confidence survey in Ukraine, conducted by GfK Ukraine on a monthly basis.

In July 2012 the Consumer Confidence Index (CCI) decreased by 3 p. to 81.1. 

Index of Current Situation decreased by 2.2 p. to 81.2. The components of this index changed in the following way:

Index of Current Personal Financial Standing (x1) gained 3.2 p. and reached 84;

Propensity to Consume (х5) fell by 7.5 p. to 78.3.

Economic Expectations of the population decreased by 3.6 p. to 81. The components of this index changed as follows:

Index of Expected Changes in Personal Financial Standing (х2) lost 2.2 p. to 91.4;

Index of Expected Economic Conditions in the Country Over the Next Year (х3) fell by 6.1 to 72.3;

Index of Expected Economic Conditions in the Country Over the Next Five Years (х4) decreased by 2.5 p. to 79.3.

Expectations regarding changes in unemployment remained stable in July: the respective index is 127.5 which repeats the value fixed in June. Though, positive dynamics in inflationary expectations were observed: index value decreased by 3.8 p. to 182.1. The index of devaluationary expectations of Ukrainians increased by 0.6 p. to 134.5.

The following key trends were observed in July:

After two months increase, July consumer confidence are back on the level of April. Though index of current personal financial standing reached the maximum value of 84 p. from July, 2010, the deterioration of other CCI components provoked the confidence decrease in general. The highest wave of pessimism concerns the nearest perspectives – index of economic expectations of the country over the next year and the propensity to consume diminished by 6 and 7.5 p. respectively. As the July expectations regarding changes in unemployment haven’t changed and stay moderate, index of inflationary expectations fell to the lowest value of 182 p. from July, 2011; on the contrary, index of devaluationary expectations rose to the new highest level from the beginning of the year, so the main misgiving of Ukrainians is caused by the financial crisis expectations.

Deterioration of consumer confidence in July was typical for the respondents of younger and average age groups, while among Ukrainians aged 46-59 the confidence increased a little. The most significant decrease of CCI (by 10 p.) was observed among the citizens with low-average income and among inhabitants of Kyiv and Western Ukraine.

 "Prevailing thought of devaluation unavoidability and financial crisis threat after elections that will take place in October, 2012, decreases the expectations and holds their consumption back which limits internal demand. This associates with unfavorable situation on external markets and threats economic growth in Ukraine in the second half of 2012", - as the GfK Ukraine analysts comment.