Business, consumer confidence still rising
Business confidence rose to record levels amid the general election euphoria, while consumer confidence rose to the third highest level on record.
But those levels will likely attenuate over the next two quarters, says Don Anderson of Market Research Services, who conducts the survey in collaboration with US-based professor Richard Curtin on behalf of the Conference Board of the Jamaica Chamber of Commerce.
"The data is straight forward and positive. The economy is in a good place and both businesses and consumers are confident about what is taking place and they expect the economy to continue to grow in the short to medium term," said Anderson at the release of the quarterly indices on Tuesday.
"Based on the history, expectations will start to taper off in the next six months after an election," he said.
The business confidence index hit 144.6 points in the first quarter 2016 survey, up from 123 in the fourth quarter of 2015 and 131.9 a year earlier.
Consumer confidence index hit 147.9 points in the first quarter, up from 124.4 in the fourth quarter of 2015 and 114.3 a year ago.
"Optimism among Jamaican firms rose at the start of 2016 to its highest level in the 15-year history of the survey. Optimism surged 17.6 per cent over the prior quarter largely due to the economic policies advocated by the new Government,” the survey report stated.
“To be sure the establishment of the new record level benefited from gains in confidence over the past few years as well as growing concerns about the prior government's policies.”
Anderson downplayed any specific policy that favoured or concerned consumers who voted in the General Election in February. He argued that consumer and business confidence generally rise during election periods.
Asked by Jason Morris of Scotia Investments for further explanation on the researchers’ take on the policy impact on confidence, Anderson suggested he was not entirely on board with how that aspect of the report was worded.
"Let me say that there is a collaborative effort in the release between myself and Professor Curtin. I wouldn't have expressed it in the way it was expressed because in reality ... there was no real change in the policies of either government,” he said.
“Clearly the IMF programme is still in operation. So there is no real change," said Anderson. "So I would have been a bit softer in that expression."
Morris followed up: "Jamaican people do not like to read. So the first set of figures that we see, that is what will stay in our minds. And this is in your first paragraph".
Said Anderson: "I would like to suggest that it was differently worded by me. In other words there has really been no change and I don't think we can say that the growing confidence is the result of any action of the old or new government.”