Men sit on massage chairs in a shop at the Chinese Dragon mall in Dubai (Photo: Reuters)
Global consumer confidence remained weak in the third quarter with more than 60 per cent of consumers saying it was not a good time to spend, and one-in-three North Americans saying they have no spare cash, a survey showed on Sunday.
The economic outlook, followed by job security, became consumers' biggest concern in the third quarter, overtaking worries about rising inflation, according to the uarterly survey by global analytics and information company Nielsen.
The Nielsen Global Consumer Confidence Index dipped just 1 point in the third quarter from the second quarter to 88 points, but it was shored up by a surge in confidence in emerging economies Brazil and Saudi Arabia, which masked weak confidence in major developed economies.
A reading below 100 indicates consumers are pessimistic about the economic outlook for the coming months.
Confidence was highest in India for a seventh straight quarter but India's reading fell 5 points from the second quarter and Saudi Arabia was catching up.
Consumer morale in the euro zone remained especially weak, notably in France, as the region's debt crisis deepened during the summer. Confidence in Greece, at the centre of the crisis, actually rose sharply but it was still the fourth-weakest of markets surveyed. Confidence was lowest in Hungary.
One-in-five Europeans said they have no extra cash to spend, although that was better than one-in-three North Americans.
Confidence in European powerhouse Germany was better than much of Europe and the United States, but like the U.S. its reading dipped 1 point from the second quarter.
"The third quarter was volatile and challenging for global economies and financial markets amid stagnant U.S. unemployment figures and a worsening euro zone debt crisis," said Venkatesh Bala, chief economist at The Cambridge Group, a part of Nielsen.
"A recessionary mindset is growing among consumers as more than half say they are currently in a recession -- up 4 percentage points from last quarter and 7 points from the start of the year. The result is continued spending restraint for discretionary expenses, which is expected to continue into next year."
The survey, taken between Aug. 30 and Sept. 16 and covering 28,000 consumers in 56 countries, showed 64 per cent of consumers globally saying it was not a good time to spend.
Financial markets picked up last week following a euro zone agreement to tackle its debt crisis and after encouraging third-quarter U.S. economic growth data, but further positive data will be required to reassure consumers.
Confidence in China dipped a point while in Europe the Baltic states of Latvia and Lithuania saw a surge in confidence, though it was still relatively low.
The survey showed that global consumers facing tighter budgets would cut back on clothing purchases, dining out and buying electronics and appliances before anything else.
"If the global economic climate worsens, these three sectors appear to be particularly vulnerable," said Bala.
The survey is based on consumers' confidence in the job market, status of their personal finances and readiness to spend.