Consumer confidence ebbs on low New Year expectations

MADRID
NATIONAL consumer confidence sank 5.4 points last month in comparison with November largely as a result of the population's poor perception of the current economic situation, the Official Credit Institute (ICO) reported yesterday.

The ICO said that the slump in consumer confidence in December contrasted strongly with the fact that the index had risen by 2.9 points in November, confirming the assessment that confidence remains a highly volatile yardstick.

The Institute said that the doubts poured on Spain's ability to cope with its debt crisis by international markets reinforced national fears about both the current economic situation and what can be expected in the coming year.

The ICO said that global views on Spain's economy were having an increasing impact on national consumer confidence.

EU BAIL OUT FEARS
Since the debt crises that affected Greece and Ireland earlier this year which required a European Union bail out, consumers have been more acutely aware that analysts have earmarked Spain as potentially being “next on the list.” However, said the ICO, the worries over the national economic climate were not necessarily reflected in people's views of what directions the family's finances were going to take. This aspect of consumer confidence, the Institute said, is currently the most buoyant.

The Institute nevertheless pointed out that at the end of 2010, overall consumer confidence was 10.1 points lower than it was a year ago, a combination of a 4.9 drop in outlook for the present economic situation and a 15.3 percent downturn in optimism over the future.