Consumer Confidence in Brazil drops 3.3 points in November

The Consumer Confidence Index (ICC), measured by FGV IBRE, fell 3.3 points in November, reaching 85.3 points, the lowest level since August when 83.6 points were recorded.

This is the second consecutive month of decline.

Even with the reduction, the index continues to advance 0.5 points in quarterly moving averages, reaching 87.6 points, influenced by the rise in the last four months.

“Once the effect of the income transfers is over, low-income consumers are once again feeling less satisfied with their family financial situation and revising their expectations downwards in the coming months,” points out Viviane Seda Bittencourt, coordinator of the surveys.

“Even with a drop in the inflation outlook and a still positive effect on the labor market, there is an increase in pessimism about household finances in the coming months.”

There may still be some room for consumption by families with higher purchasing power. Still, given the macroeconomic conditions, its sustainability in the coming months is a difficult task,” says the coordinator.

The November drop in the ICC was influenced by the worsening of evaluations about the present moment and the reduction in expectations about the coming months.

After three months of increases, the Current Situation Index (ISA) fell 3.7 points to 70.8 points, the lowest level since July 2022 (70.3 points), while the Expectations Index (IE) dropped 2.7 points to 96.0 points for the second consecutive month.

According to the survey, there was a worsening in families’ satisfaction with the economic situation and personal finances.

The indicator that measures the evaluations of families’ financial situation fell 5.6 points to 60.9 points, the worst result since March 2022 (56.9 points).

The indicator that measures satisfaction with the economic situation dropped 1.9 points to 81.2 points after accumulating five consecutive highs.

Among the items that make up the ICC, the one that most contributed to the drop in the month was families’ financial situation in the next six months.

The indicator dropped 5.6 points to 92.5, the lowest level since August. The indicator that measures the degree of optimism with the general economic situation fell 4.6 points to 110.6 points, the only one still above the neutral level.

On the other hand, the intention to buy durable goods rose 2.5 points to 85.5 points, offsetting the previous month’s loss.

The analysis by income bracket shows a loss of confidence in all but the highest income bracket (income above R$ 9,600.01).

The assessment of lower-income consumers about their families’ financial situation fell again, influenced by recent improvements due to tax incentives and income transfers.

Consumers continue to revise their expectations downwards for the higher income classes, but there is some room for consumption in the coming months.