The Consumer Confidence Index remained at a low level (40.9 on a scale of 100) from November 2017 until February 2018, which is an atypical situation since the country went through an electoral period, which normally causes an increase in the positive expectations of the people, as it happened in 2006, 2010 and 2014.
It is believed that supporting a specific candidate can inject a dose of positivism in his followers about the course the country will follow in the coming years (…) However, in February 2018 the confidence did not improve significantly, which constitutes a atypical behavior that occurs for the first time in the country,”
explained Johnny Madrigal, a researcher at the School of Statistics of the UCR.
The analyst added that in the past, the second rounds tend to increase positive expectations, something that did not happen now.
The discussion about granting of rights to the LGTBI community promulgated by the Inter-American Court of Human Rights could obscure the discussion and dissemination of the proposals that presidential candidates have on the country’s main problems. Despite this, the media do warn about the difficult situation that the country is going through in tax matters,”
added.
Madrigal stressed that the level of confidence has remained low during the last year. A review of what happened in the three previous national elections reveals that at election time the confidence in the future economic direction is also renewed in important magnitudes (12.8 in the Solis Administration, 6.6 points in the Chinchilla Administration; points in the Arias Administration). However, the recent increase was just 3.3 points.
According to the data collected by the Consumer Confidence Survey, 61% of Costa Rican consumers expect increases in interest rates during the next 12 months. This trend has been reinforced since 2016, when the effects of the government postponing the tax reform began to manifest themselves.
Also, 67.9% expect increases in the exchange rate throughout the year and 72.5% believe that the cost of fuels will rise in the same period. In addition, 38.9% of consumers believe that their family income will grow less than inflation, which translates into a perception of a higher cost of living.
The assessment of the time of home purchase, over time is negative: 57.6% believe that these are bad times. Nearly 65% of the population also believes it is a bad time to purchase a vehicle.