Without a drop in the inflation, which on the contrary has been on the rise throughout 2022, consumer confidence and spending have reached crisis levels in the main European marketsso much so that it has been observed that people have returned to the consumption habits of the 1970s and 1980s, as a way of coping with high prices.
(Also read: IMF calls for fiscal adjustment not to be hostile to growth).
This was revealed by a report by the IRI firm presented this week, noting that consumers are showing signs of “inflationary fatigue” severe that is leading them to, for example, bring home-made lunches back to worknot going out as much, buying products on sale or even expired, and, for some, reducing their savings.
The report analyzes the impact of the pandemic, inflation and cost of living crisis on more than 230 categories of consumer goods, more than 2,000 product segments and more than 100 million SKUs in the US and several of the largest markets in Europe (France, Italy, Germany, Spain, United Kingdom and the Netherlands) and Asia.
From these data, he concludes that the decline in disposable income is affecting low- and middle-income consumers throughout the developed world, and now consumers are having to dip into their personal savings to survive.
(More notes: Global recession: how is Colombia today and how bad can it be in 2023?).
The report highlights findings such as 61 percent of consumers surveyed in Europe’s largest markets say they are concerned about the impact them personally and 71 percent have already made changes to the way they buy and use everyday items.
Likewise, 58 percent of people have reduced things like driving to work or shopping, skipping meals and reducing their use of heating; Similarly, 35 percent dip into their personal savings and take out loans to pay bills.
(You may be interested: United States: the risks of a possible recession in the world’s largest economy).
“The ongoing drop in unit sales in response to inflation is an early indication of weakness in demand for consumer goods.”, commented Ananda Roy, global senior vice president of Strategic Growth Prospects at IRI.
Roy added that as they themselves are experiencing higher input costs, brands and retailers need to take a fresh look at how they can help consumers during this difficult time.
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