Understanding consumer vs business confidence

According to Dawn, consumers in Pakistan are far gloomier than firms, with the September SBP-IBA Confidence Index at 49.1 against 33.6 on the Q3 Ipsos Consumer Confidence Index. The publication says such a gap merits scrutiny from policymakers, economists and business leaders if the surveys are credible. It suggests the split may reflect how each group reads economic data, trust in government, or the uneven financial positions across society.

Dr Durre Nayab, a former joint director at the Pakistan Institute of Development Economics (PIDE), attributes the gap mainly to measurement methods and sampling. She notes that the SBP-IBA index treats 50 as neutral while the Ipsos gauge has usually sat in the 30s, and that the business survey covers about 2,000 large SECP-registered firms. Nasim Beg of Arif Habib Consultancy instead contrasts forward-looking business decisions with consumers' reactions to daily experience.

Industrialist Majyd Aziz doubts that the Ipsos index captures ground realities, noting its 1,000 telephone interviews, and says only 10pc of consumers feel at ease with household spending. He argues that gains in stock prices, property and car purchases mainly serve wealthier households rather than signalling broad recovery.