Greek consumer confidence improved in September, but Greek households remained the most pessimistic in the European Union, according to the latest economic survey by the Foundation for Economic and Industrial Research (IOBE).
The consumer confidence indicator rose to -41.6 points in September, from -47.8 points in July. Despite the improvement, Greece remained at the bottom of the EU rankings, with Romania and Bulgaria following.
The survey also points to continued pressure on household finances, with a large share of consumers reporting that they are only just managing to cover their expenses.
Most households are barely making ends meet
According to IOBE’s survey, 58% of consumers said they are “barely making ends meet,” unchanged from the previous month.
The share of households reporting that they are drawing on their savings declined slightly to 12%, from 13%. Meanwhile, 22% of consumers said they were saving either a little or a lot.
Another 7% said they had gone into debt, unchanged from the previous period.
Households also reported a largely negative assessment of their recent financial situation. Sixty percent said their financial position had deteriorated either slightly or significantly over the previous 12 months, while only 3% reported a slight improvement.
82% do not expect to save
Consumers remained similarly pessimistic about their financial prospects over the coming year, although the relevant negative indicator improved slightly to -41.0 points in September, from -44.4.
Fifty-five percent of households, down from 59%, expected their financial situation to deteriorate slightly or significantly over the next 12 months. Only 5% anticipated a slight improvement.
By comparison, the corresponding indicators stood at -5.5 points in the EU and -6.1 points in the euro area, highlighting the significant gap between Greek consumers and their European counterparts.
Spending expectations also remained subdued. Forty-six percent of consumers, down from 53%, expected to spend less or much less over the next 12 months, while only 5% expected to increase their spending.
Saving appears particularly unlikely. Eighty-two percent of households said they did not consider it likely that they would save money over the next year. Only 16% considered saving likely or very likely.
Consumers expect unemployment to rise
Greek households also remained concerned about unemployment.
The indicator measuring expectations for unemployment over the next 12 months rose slightly to +18.2 points, from +17.9 in July, according to the survey.
Thirty-eight percent of households expected unemployment to increase either slightly or significantly, while 12% anticipated a slight decline.
The corresponding indicators were considerably higher in the EU and euro area, at +27.6 and +28.3 points, respectively.
Most households still expect prices to rise
Expectations for price increases also remained firmly positive, although they eased during September.
The indicator measuring expected price developments over the next 12 months fell to +35.0 points, from +40.0 in July.
Sixty-two percent of households expected prices to rise at the same or a faster rate, while 17%, up from 13%, expected prices to remain stable.
The corresponding indicators stood at +33.9 points in the EU and +35.2 points in the euro area.
Uncertainty over the economic outlook eases
Households’ assessment of uncertainty about future economic developments also improved in September.
Fifty-two point four percent of respondents said their financial situation was difficult or relatively difficult to predict, down from 59.3% the previous month.
The results point to a modest improvement in consumer sentiment, but household finances remain under significant pressure, with most consumers expecting limited room for spending or saving and continued increases in the cost of living.
