Demands for tourism and durable goods such as immovable assets, automobiles and major appliances are very elastic. According to the stylized facts of business cycle, consumer spending on these goods is pro-cyclical and more volatile than GDP. For example, during an economic downturn, households cut spending on durable goods such as automobile, major electric appliances immediately. Hence, households planning to spend on durable goods contain crucial information about the future state of the economy. Quarterly CCI survey studies households’ planned purchase in the next 6 months.
Planned purchase in the next 6 months
Since 2014, demands for tourism and durable goods have fallen significantly. Although the demands for automobiles has increased compared to the same period of 2016, for other items they have decreased. This decrease could be explained by an increase in the number of consumers who think that the timing is not right to buy durable goods. Furthermore, an expected decline in house prices also results in a weak demand for immovable assets.
19.0 percent of the consumers feel that it is the right time to purchase durable goods, whereas 64.7 percent find it otherwise. A share of respondents feeling that it is the right time to purchase durable goods has decreased by 3.3 percentage points, whereas the share respondents feeling the opposite has increased by 6.4 percentage points. A share of “don’t know” response has decreased by 4.5 percentage points.