ISET

After reaching a historic low in April 2020 Georgian consumer confidence has been steadily reviving. Covid-19 has shaken the world as well as Georgian consumers. One of the evidence that it has been an extraordinary time for Georgian consumers is that in April expectations index dropped below the present situation index for the very first time (see Figure 1). Therefore, we can speculate that negative perceptions of the present may have inflated in April due to a deep fear of the future. Hence, when people realized their expectations were not being met, they started to adjust accordingly.

The interviewed sample in early May, of around 350 Georgians (Table 1 below summarizes the demographic background of the sampled population), reveals that Georgian Consumer Confidence rose in May compared to the prior month, by 8.1 index points, from -48.3 in April to -40.2 in May. This follows rapid declines in the index in March and April. The increase in Consumer Confidence was driven by the expectations index, particularly consumers are positive about general economic situation and their ability to save, for the next twelve months. Therefore, not surprisingly, Expectations Index registered an increase by 17.2 index points, from -51.2 in April to -34 in May. While, the other index that measures how Georgians feel about the economy right now, the Present Situation Index, went down by 1.1 index points, from -45.3 in April to -46.5 in May. The latter negative change occurred, as consumers remain concerned about their financial prospects and general economic situation at present.

  • In April 2020 Consumer Confidence reached the lowest level ever recorded, driven by severe deterioration in expectations about the future.
  • Notably, the present situation index component of CCI stands slightly higher than during the regional currency crisis and lari devaluation episode in May-November 2015.
  • The supplementary CCI poll reveals that nearly 24% of interviewed population have completely lost their jobs.
  • Nearly 35% expects to partially get their jobs back after the quarantine ends.
  • 10% of respondents do not expect to get their jobs back. In the same time, 13% do not know what will happen to their jobs.
  • Around 30% of interviewed people reported their families did not have enough resources to live on until the 21st April.
  • Around 60% both in Tbilisi and in the rest of Georgia reported their families would not have enough resources to live on if strict quarantine is extended until the end of May.
  • In the same time, the interviews reveal that an overwhelming majority of people (81%) tends to trust the health advice and information on COVID-19 coming from the authorities.

A nationally representative sample of around 350 Georgians (Table 1 below summarizes the demographic background of the sample), interviewed in early April, reveals that Georgian Consumer Confidence reached a historic low point in April. The CCI has sunk this month by a significant 15.2 index points, from -33.1 in March to -48.3 in April.
The record drop was driven by the lowest-ever expectations index, indicating that people have grim forecasts about the future of the economy despite the fact that they tend to trust the health and pandemic related information coming from the authorities.

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