The Luxembourg Central Bank (BCL) said its monthly consumer confidence indicator “has fallen sharply” in surveys fielded during the first half of March.
The indicator dropped from -3 in February 2020 to -10 in March 2020. (The figure was 1 in March 2019 and -2 in March 2018).
However, the central bank noted that sentiment could shift further in its next report, stating:
“The telephone interviews were conducted between 1 and 13 March 2020, i.e., prior to the strengthening of measures to combat the spread of covid-19.”
The central bank said households’ outlook on the overall Luxembourg economy “recorded a record drop of 19 points”.
“While their intentions in terms of major purchases have fallen significantly,” the report said that Luxembourg households’ view of their own personal financial situation suffered a relatively milder hit. Again, survey-takers spoke with residents before wide swaths of Luxembourg’s economy were shut down.
According to the BCL, all four of the indicator’s underlying components “declined this month”:
The score for “consumers’ expectations of the general economic situation in Luxembourg” slumped from -5 in February 2020 to -24 in March 2020. (In contrast, it was 4 in March 2018 and 2 in December 2017.)
The gauge of households’ “perception of their financial situation over the past 12 months” decreased from 4 in February 2020 to -1 in March 2020. (By comparison, it was 1 in March 2019 and 2 in March 2019.)
The metric for households’ “expected financial situation over the next 12 months” fell from 0 in February 2020 to -1 in March 2020. (It was 7 in March 2019 and 6 in March 2018).
The measure for “intended spending on major purchases (furniture, electrical devices…)” sank from -9 in February 2020 to -14 in March 2020. (It was -4 in March 2019 and -20 in March 2018.)
The scores represent the “difference between the percentages of respondents giving positive and negative replies” in the BCL’s monthly polls.