The recession is alive and kicking in Israel, but the public believes that it will soon become history. The Consumer Confidence Index rose by 9.5 points (13.6%) in June 2009 to 79.2 points (1996 = 100 baseline), a 14-month high. The index fell by 6.4 points in May, after jumping 15.4 points in April, and rose by a cumulative 18.5 points in April-June.
In three-month rolling trend figures, the Consumer Confidence Index rose by 6.2 points in June to 75 points, after rising 2.3 points in May and 4.2 points in April. After falling for seven consecutive months, the index has risen for three consecutive months in trend terms, reinforcing the assumption that the public believes that the economy is on the verge of a positive turnaround.
In trend figures, the expanded Consumer Confidence Index, which includes questions about the job market in six months time, depicts a similar and possibly even more optimistic picture. The expanded Consumer Confidence Index rose by 9.1 points in June, after falling by 3.8 points in May and plummeting 16.1 points in April.
The Consumer Confidence Index is compiled by Globes Research and Kesselman and Kesselman - PricewaterhouseCoopers Israel. It hints at a possible growth in private consumption, with an increase in purchases durable goods for the first time since late 2007.
Israel is not alone among developed countries in seeing an apparently inexplicable rise in consumer confidence. It seems that the rise is a function of a jump in stock prices, which has enabled long-term saving instruments to recoup part of their losses in 2008.
Published by Globes [online], Israel business news - www.globes-online.com - on July 15, 2009
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