BEIRUT: Consumer confidence remained below expectations in the first quarter of 2019 despite the formation of the Cabinet and the pledge to implement reforms, according to the Byblos Bank/AUB Consumer Confidence Index issued Tuesday. “The results show that the Index regressed by 10.4 percent in January 2019 from December 2018, increased by 13.6 percent in February and decreased by 2.5 percent in March 2019. Further, the Index averaged 75.5 in the first quarter of 2019 and was unchanged from the fourth quarter of 2018,” the report said.

It added that the average monthly score of the Index in the first quarter of 2019 was 28.7 percent lower than the quarterly peak score of 105.8 registered in the fourth quarter of 2008, and remained 22 percent below the annual peak of 96.7 reached in full year 2009.

Commenting on the results, Nassib Ghobril, chief economist and head of the Economic Research and Analysis Department at Byblos Bank Group stated: “Household sentiment was directly correlated to political developments during the first three months of 2019, as the January drop reflected the repeated false signals in late 2018 about a breakthrough in negotiations to form a new government. But the formation of the government on the last day of January, after nine months of political deadlock, led the Index to jump in February.”

He added that the short optimism following the formation of the Cabinet did not last too long.

Ghobril added that “the short-lived momentum in February and the retreat of the Index in March highlight the fact that Lebanese citizens consider that the government’s formation in itself is not sufficient, and that it is not an achievement as politicians like to claim.”

Ghobril noted that Lebanese truly believe that is a basic right of every tax-paying citizen to have a functioning government in place. “As such, households need to see concrete evidence and tangible solutions that would raise their standard of living and economic well-being in order to improve their confidence level, as they have repeatedly seen many politicians put personal or partisan agendas ahead of the national interest.”

The report indicated that the first-quarter results reflect the still-low expectations of households, as 10.6 percent of the Lebanese polled in the first quarter of 2019 expected their financial conditions to improve in the coming six months compared to 9.6 percent in the fourth quarter of 2018.

“In parallel, 60 percent of respondents in the covered quarter believed that their financial situation would deteriorate, up from 57.9 percent in the previous quarter, and 27.2 percent forecast their financial condition to remain the same in the next six months. In addition, 9.1 percent of the Lebanese surveyed in March 2019 expected business conditions in Lebanon to improve in the coming six months, down from 9.6 percent in December 2018,” the report said.

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