- Indonesian optimism: A striking 73% of Indonesians show optimism about their country’s economic growth, contrasting with a more cautious sentiment observed in other parts of Asia.
- Singapore’s inflation challenge: Singapore reports the highest inflation rate among the surveyed markets, with 92% of consumers noting a rise in living costs.
- Hong Kong, however, is the least optimistic among the six surveyed markets due to the slow recovery of economy and the effects of international monetary policy.
- Asia’s population attributes their optimism to various factors, including robust economic growth, infrastructure development, national security, innovation and technology, and the stability of the financial system.
- The report showed respondents intend to increase spending across most Asian markets with Indonesia at the forefront, where nearly 80% of the respondents express a desire to up their spending in the next 12 months.
- Luxury spending resilience: Despite economic pressures, affluent consumers in Singapore and Hong Kong intend to increase their luxury purchases, demonstrating the resilience of the luxury sector.
- Wellbeing and work-life balance: A significant cultural shift towards health, wellness, and work-life balance is evident, with consumers prioritising personal wellbeing.
- Political climate impact: Over 60% of consumers in Vietnam, Indonesia, and Singapore view their political environment as a positive influence on economic growth.
A new economic and spending sentiments report has revealed a prevailing sense of optimism across Asian markets, despite mounting concerns over the rising cost of living.
Findings from the report indicate a widespread positive outlook towards the economy in Asia. Notably, Indonesia emerges as a frontrunner, with over 60% of respondents expressing confidence in an improved global economy. Similarly, Vietnam demonstrates strong optimism, with more than 50% of participants sharing positive sentiments. While Malaysia and Singapore exhibit a more reserved stance, over two-fifths of participants still hold optimistic views regarding the global economy. Conversely, the outlook in Hong Kong appears more cautious, with only 20% of respondents expressing optimism. This reflects the region’s gradual economic recovery and the influence of both cyclical and structural factors.
Asian populations attribute their optimism to various factors such as robust economic growth, infrastructure development, national security, innovation and technology, and the stability of the financial system. However, the report emphasises the importance of considering the potential impact of inflation and political sentiment on economic growth and stability. Notably, over 60% of consumers surveyed in Vietnam, Indonesia, and Singapore view their political environment positively influencing the economy.
Singapore faces the highest inflation rate among the surveyed markets. 92% of consumers surveyed in Singapore reported a rise in living costs in 2023, which the report suggests is behind a cautious approach to consumer spending. The report indicates a region-wide trend of inflationary pressures: the lowest proportion of consumers reporting an increase was found in Thailand where three quarters (76%) still reported increased living costs.
As Asia continues to drive global economic growth, its economic sentiments significantly shape consumer spending behaviour. Research indicates a strong intention to increase spending across most Asian markets, with Indonesia leading the way as nearly 80% of respondents express a desire to boost their spending in the next 12 months. Conversely, sentiment in Singapore signals a more restrained approach, with 59% of respondents planning to increase their spending.
The report’s insights have delineated three distinct tiers of spending priorities, mirroring the evolving consumer inclinations and aspirations prevalent in Asian markets. These tiers encompass a diverse array of lifestyle categories, practical investments, indulgences, and aspirational acquisitions, all shaped by a confluence of factors including the lingering impacts of the pandemic, cultural preferences, economic landscapes, and societal influences. Across Singapore, Hong Kong, Indonesia, Thailand, Malaysia, and Vietnam, there is a noticeable emphasis on lifestyle essentials such as food and beverage, health and wellness, and travel. Trends observed over the past year signal a perceptible shift in mindset catalysed by the pandemic, with populations increasingly valuing overall wellbeing and the pursuit of enriched life experiences. This shift is translating into a reorientation of budgets towards experiences and activities that enhance quality of life and contribute to a more fulfilling lifestyle.
Simon Tye, CEO of MDRi, commented:
The Sentiments Report offers a wide-ranging snapshot of economic confidence across Asia, from Indonesia’s significant optimism to the sophisticated luxury spending in Singapore and Hong Kong. These insights are crucial for businesses as they navigate Asia’s economic landscape, which is marked by a blend of optimism and, in some instances, caution. Getting to grips with these economic trends is essential for capitalising on opportunities and tackling challenges that arise in future.
