Growth in global consumer spending has slowed, but the good news is, the slowdown may have eased in October, leading to a possible gradual recovery in 2013, according to the PwC’s new Global Consumer Index.
The index results show that, in terms of growth rate, there has been a decline for five consecutive months, but the latest value shows it is ticking up to 1.7 percent in October, from 1.5 percent in September. This is significantly below the long-run average value of 2.8 percent, said PwC, and the recent figures are the lowest since the end of the financial crisis.
In terms of momentum, the results look at what annual growth would be if the index were to grow at the rate of the last three months for a whole year. Following four consecutive and sharp monthly falls, this briefly turned negative in August. The latest value shows it recovering slightly to 1 percent in October from 0.2 percent in September.
“This is a relatively good story, as had this score stayed negative, it may have implied a double dip in the consumer spending cycle,” the UK-based research and consultancy service said.
“The latest growth and momentum figures suggest very low growth, but currently no double dip recession in the global consumer cycle,” said Richard Snook, senior economist at PwC and lead author of the report.
“However, we do expect a gradual recovery in global consumer spending during 2013, assuming no major adverse shocks from the eurozone or global commodity prices,” he added.
Christine Cross, chief retail and consumer adviser to PwC, said: “As the GDP of both developed and developing economies reduces, so will consumer propensity to spend on discretionary items in particular. Retailers may not only feel the impact of this on their domestic trade, but those with actual or planned exposure to sales in international markets may also see a slowdown.”
Photo: Axel Hecht
