In the second half of May 2010, the PBC conducted a questionnaire survey on urban depositors in 50 large, medium and small cities across the country. The survey findings are as follows:
1.Current income sentiment index slightly falls and expectations are cautious over future income and employment
As the survey indicates, in Q2 the current income sentiment of urban residents registered an index of 49.5%, or 51% excluding seasonal factors[1]. The index fell slightly by 1.1 percentage points quarter on quarter, bringing to a halt its upward movement for three consecutive quarters.
In terms of expectations for future income and for future employment, both indexes fell, dipping 2.6 and 3.3 percentage points respectively quarter on quarter. This shows rising feelings of uncertainty over future income and employment.
2.Price satisfaction for Q2 declines and the rise in price expectations index moderates excluding seasonal factors
According to the survey, the current price satisfaction index registered 21.7%, falling 4.2 percentage points quarter on quarter to a new historic low. Respondents who considered current prices "too high to be accepted" accounted for 58.9%, the largest share recorded in 10 years.
The portion of respondents who expected price rise in the next quarter expanded compared with Q1. The index of future price expectations rose to 70.3%, a high level in the same periods of past years. Excluding seasonal factors, the price expectations index was almost the same as a quarter earlier, with weakened upward momentum.
3.Expectations for house price rise are going down and house purchase sentiment drops in a wait-and-see atmosphere
With regard to the current house price level, 72.5% of respondents said it was "too high to be accepted". The proportion hit new high, having expanded consecutively since Q2 of 2009[2].
29.3% of respondents expected future house prices to rise, down 10 percentage points from Q1, a sign that expectations of house price rise started subsiding. Accordingly, a wait-and-see atmosphere took hold and house purchase sentiment declined. Only 15.5% of respondents wanted to buy houses in the next three months, falling for the second straight quarter, with a cumulative decline of nearly 3 percentage points, in contrast with the steady upward trend since 2009.
4.Investment sentiment drops, consumption sentiment holds and preferences for savings deposits continue to rise
Compared with a quarter earlier, investment sentiment of urban residents dropped, consumption sentiment held steady and preferences for savings deposits stayed high. Of those surveyed, 45.7% chose to "make more savings deposits", 36.4% preferred to "make more investments", including purchases of bonds, funds, shares, etc., and 18% were inclined to "consume more".
[1]Adjusted via the PBC-X12-ARIMA program, hereinafter the same.
[2]As questions on housing price opinions have been added to the depositor survey since Q2 of 2009, corresponding time series start from then on.
