The Consumer Confidence Index (CCI) of the cross-strait region, Hong Kong and Macau for the 1st quarter of 2020 announced on 8 April 2020 that the overall Hong Kong CCI was 55.3, down 19.5% year on year (YoY) and down 31.7% quarter on quarter (QoQ).

The result of this quarter is the second lowest point since this index was introduced in the third quarter of 2008, which is close to lowest record of 52.8 measured in the third quarter of 2019. All the sub-indices are measured at 65 or lower, showing that Hong Kong consumers lack confidence regarding these aspects.

Significant decreases in consumer confidence in Stock Investments, Commodity Prices, Standard of Living and Employment

There were significant decreases in confidence levels in four main aspects: Stock Investments, Commodity Prices, Standard of Living and Employment.

The overall sub-index for stock investment is 50.0 (Table 1), with a huge YOY decrease of 37.3% and a significant decline of 25.7% when compared with the previous quarter. The result for the present situation is 48.3 (Table 2), a considerable fall by 27.0% from the previous quarter. The confidence level for the coming three months is 51.1 (Table 2), with a significant decrease of 24.9% compared to the former quarter. This indicates that consumers’ confidence level in this aspect has significantly dropped.

The overall commodity price sub-index is 58.6 (Table 1), a YOY decrease of 15.9%. When compared to the last quarter, it shows a significant drop of 23.1%. The current sub-index of commodity prices is 47.3 (Table 2), with a considerable decline of 25.5% when compared with the former quarter. The result for the coming three months is 66.1 (Table 2), a significant drop by 22.0% from the last quarter. This indicates that Hong Kong consumers’ confidence level in this aspect has dropped and is still weak.

The overall sub-index of living standard measures in at 65.5 (Table 1). It has experienced a huge YOY drop of 31.7% and has significantly declined by 21.6% from the previous quarter. However, it is still the aspect in which Hong Kong people have most confidence. The result for the current situation is 62.8 (Table 2), a considerable decline by 30.5% compared with the last quarter. Hong Kong people’s confidence in living standards for the coming three months is 67.3 (Table 2), which is a significant decline by 14.7% when compared with the last quarter. The absolute value of the future sub-index is low, which indicates that local consumers have not recovered their confidence.

The overall sub-index of employment is 53.3 (Table 1), which is a huge YOY decline of 42.0% and a significant decrease of 20.7% compared with the last quarter. The result for the present employment situation is 50.0 (Table 2), a steep decline by 25.8% on the previous quarter. The index for employment confidence in the coming three months is 55.5 (Table 2), a decrease of 17.3% when compared with the previous quarter. This indicates that locals’ confidence level in employment becomes lower. The absolute value of the sub-index is low, showing that consumers continue to worry about employment.

Consumer confidence in Economic Development and Property Purchases declines

Consumer confidence has declined in the other two aspects: Economic Development and Property Purchases.

The sub-index of Hong Kong residents towards economic development is 55.8 (Table 1), with a huge YOY decrease of 39.0% and a decrease of 14.5% when compared with the previous quarter, showing that consumer confidence in economic development has dropped from the previous quarter. The result for the present economic situation is 54.8 (Table 2), with a decline of 11.2% compared to the last quarter in this aspect. The result for economic confidence in the coming three months is 56.4 (Table 2), a decrease of 16.7% compared with the previous quarter. The absolute value of the sub-index is low. It demonstrates that Hong Kong citizens worry about the economic situation.

The overall sub-index of 48.8 (Table 1) shows that Hong Kong residents still have the lowest confidence in Property Purchases. The index experiences a YOY decrease of 15.0% and a drop of 7.0% compared with the last quarter. The result for current property purchases is 49.5 (Table 2), which remains steady at a level comparable to the former quarter. Citizens’ confidence in property purchases for the coming three months is 48.3 (Table 2), which is a decrease by 11.4% from the last quarter. Compared to the last quarter, this sub-index has declined, and is the aspect in which Hong Kong consumers have the lowest confidence.

The overall result drops significantly compared with the result of the last quarter due to the decrease in consumer confidence in all aspects. The sub-indices for Stock Investments, Commodity Prices, Living Standards and Employment have dropped by more than 20%. The result of this quarter is the second lowest point since this index was introduced in the third quarter of 2008, which is close to lowest record of 52.8 measured in the third quarter of 2019. This indicates that Hong Kong consumers’ confidence level is still very low. The situation is possibly caused by the continuous diffusion of the epidemic in the past months.

Media enquiries:

Dr Geoffrey Tso Kwok-fai
Associate Head, Associate Professor and Director of the Statistical Consulting Unit
Department of Management Sciences            
City University of Hong Kong
Tel: (852) 3442 8568 or (852) 9020 9996

Mr Hu Yijian
Research assistant
Department of Management Sciences
City University of Hong Kong
Tel: (852) 3442 8657 or (852) 6350 2904

Appendix A: Notes for Data Collection
City University of Hong Kong is responsible for the data collection for the captioned investigation. The survey for the CCI in first quarter of 2020 was conducted by telephone interview from 9 to 31 March 2020. A random sampling procedure was adopted, and 1,003 interviews were conducted with local residents aged 18 or above. The survey results have a 95% confidence level, and the sampling error is plus or minus 1.5 percentage points.

Appendix B: Notes for the Chinese Consumer Confidence Index
The Chinese Consumer Confidence Index has been released on a quarterly basis since its launch in the first quarter of 2009. The overall consumer confidence score is an integrated index, measuring consumer sentiment about economic development, employment, commodity prices, standard of living, property purchases and stock investments. It reflects the confidence level of consumers in mainland China, Hong Kong, Macau and Taiwan. The index is jointly compiled by Capital University of Economics and Business, the Central University of Finance and Economics, City University of Hong Kong, Macau University of Science and Technology, and Taipei Medical University.

The Chinese Consumer Confidence Index uses a scale of 0 to 200, with 0 representing “no confidence” and 200 representing “complete confidence”. If the index is below 100, it suggests consumers “l(fā)ack confidence”, while if it is above 100, it suggests “relative confidence”.
 
Appendix C: Tables

Table 1. Results of the CCI index (Overall*)