Danish Confidence Bottoms and Stabilizes

Consumer confidence in Denmark in March improved slightly, moving up to -23.1 from -25.1 in February after logging a -26.1 in January. These improvements are not strong, but they are movements toward ‘better’ rather than toward ‘worse.’ The absolute reading is extremely weak with the ranking of 2.7% on data since 1995. That means that since 1995 readings have been this weak or weaker only 2.7% of the time.

The past year… The data assessing conditions over the last 12 months are generally quite weak; the financial situation for the last 12 months has a 0.6 percentile standing. The general economy reading for the last 12 months has a 3.3 percentile standing. The assessment of consumer prices over the last 12 months, of course, has a high 97-percentile standing telling us that inflation had been higher historically only about 3% of the time. That's not surprising and it's not good news. That summary sets the stage for the responses for this month.

Looking ahead The look-ahead responses from March show the financial situation for the next 12 months slightly stronger at a net 0.4 reading, up from -0.3 in February, but still with only a 3.6 percentile standing. The outlook for the general economy improved to -0.7 in March from a -6.4 reading in February, logged at a 38.8 percentile standing much better than the other standings noted to date; however, it is substantially below the 50% break even mark. Consumer prices over the next 12 months have a -8.5 assessment for March below the -8 assessment for February; the standing for this metric is the 27th percentile which is certainly a lot weaker than the 97th percentile standing for the previous twelve months. There is some expectation that inflation is going to be coming down; it is hard to tell from this whether that sort of decline is sufficient or not. The unemployment trend expected for the next 12 months has a lower net 18.6 reading in March, down from 28.4 in February (which had a small uptick compared to January). The standing still has an 87-percentile mark which is relatively high.

The environment Assessments of the environment in March change very little from February. All responses have rankings below historic midpoints (below 50%). The favorability of the time to purchase improved slightly to -39.6 in March from -41.8 in February; the favorability the time to purchase over the next 12 months improved to -15.5 from -17.9. The favorability of the time to save ticked ever so slightly higher to 64.4 from 64.3; the March favorability of the time to save over the next 12 months eroded to 22 from 23.8 logging a lower 10-percentile standing. The general financial situation of households is unchanged at 19.8, a 2.4 percentile standing. The environment is weak.

Summing up Looking across the sequential changes in categories from 12-months to a year-ago, six-months compared to 12-months and 3-months compared to 6-months, the only surveyed category that improves consistently is the favorability of the time to save. And that, generally speaking, is not a very bullish category. On the other hand, consumer prices are weaker over all these timelines, which is good news because it suggests that expected inflation has been steadily falling. Only two categories show consistent improvements over 3-months compared to 6-months and over 6-months compared to 12-months and that's the expected financial situation over the next 12 months and the assessment of the economy over the next 12 months. Those are both good things to see, that the financial situation is consistently expected to improve and the economy as well.

The readings for the Danish index remain weak. There are some positive trends and the negative trends that exist are not getting worse. However, the sense of improvement is not very strong and, for the most part, what we have here is an absence of further deterioration. Response standings continue to be extremely low. Consumer confidence in Denmark continues to be adversely impacted and weak.