The November 2025 Consumer Confidence index for SI registered at -23, improving from -25 in October and surpassing the consensus estimate of -24. This marks the highest confidence level since May 2025 (-24) but remains below the 12-month average of -26, indicating a slow but steady recovery in consumer sentiment.

Drivers this month

• Improved labor market conditions contributed 0.50 points to confidence.
• Lower inflation rates eased cost-of-living pressures, adding 0.30 points.
• Geopolitical tensions in neighboring regions dampened sentiment by -0.40 points.
• Rising borrowing costs subtracted -0.60 points due to tighter monetary policy.

Policy pulse

The index remains below neutral zero, signaling cautious consumer outlook despite recent monetary easing signals. The central bank’s inflation target of 2% remains a key benchmark, with current inflation trending at 3.10%, down from 3.80% six months ago. Consumer confidence’s improvement aligns with expectations of a gradual policy pivot but reflects ongoing uncertainty.

Market lens

Immediate reaction: The SI currency pair EUR/SIUSD strengthened 0.15% within the first hour post-release, reflecting mild optimism. Short-term government bond yields (SI2Y) edged down by 3 basis points, indicating a slight easing in risk premiums. Equity markets showed muted gains, with the SI benchmark index rising 0.40%.

Consumer Confidence is a leading indicator of household spending, which accounts for roughly 60% of SI’s GDP. The latest reading at -23, while negative, is a notable improvement from the trough of -31 in February 2025. Historically, readings below -20 have correlated with below-trend GDP growth and cautious consumer behavior.

Monetary Policy & Financial Conditions

SI’s central bank has maintained a restrictive stance since mid-2024, raising policy rates by 125 basis points over the past year. Financial conditions tightened accordingly, with credit spreads widening and mortgage rates rising above 5%. These factors have constrained consumer borrowing but also helped moderate inflation pressures.

Fiscal Policy & Government Budget

Fiscal policy remains tight, with the government targeting a deficit reduction from 4.20% of GDP in 2024 to 3.50% in 2025. Limited fiscal stimulus has restrained disposable income growth, although targeted social transfers have partially offset inflation impacts for lower-income households.

External Shocks & Geopolitical Risks

Geopolitical tensions in the region, including trade disruptions and energy supply concerns, have introduced volatility. These external shocks have contributed to consumer caution, particularly regarding durable goods purchases and long-term financial commitments.

Market lens

Immediate reaction: EUR/SIUSD strengthened modestly by 0.15%, reflecting improved risk appetite. The SI2Y yield declined by 3 basis points, signaling reduced short-term rate hike expectations. Equity markets responded with a 0.40% gain in the SI benchmark index, indicating cautious optimism.

Looking ahead, consumer confidence in SI faces a complex mix of risks and opportunities. The baseline scenario (60% probability) anticipates gradual improvement toward -18 by mid-2026, supported by easing inflation, stable employment, and moderate fiscal support.

Bullish scenario (20% probability)

• Inflation falls below 2.50%, prompting central bank rate cuts.
• Geopolitical tensions ease, boosting trade and investment.
• Consumer confidence rises above -15, fueling stronger consumption growth.

Bearish scenario (20% probability)

• Inflation remains sticky above 3%, forcing further monetary tightening.
• Fiscal austerity deepens, reducing disposable incomes.
• Geopolitical shocks intensify, depressing consumer sentiment below -30.

Policy pulse

Monetary policy decisions in the next two quarters will be critical. The central bank’s communication suggests a cautious approach, balancing inflation risks against growth concerns. Fiscal policy flexibility remains limited, constraining stimulus options.

In summary, SI’s Consumer Confidence index shows tentative signs of recovery but remains subdued by historical standards. The interplay of monetary tightening, fiscal restraint, and external uncertainties will shape the trajectory of household sentiment. Markets have priced in moderate optimism, but downside risks persist. Close monitoring of inflation trends, labor market data, and geopolitical developments is essential for anticipating shifts in consumer behavior and broader economic momentum.

Key Markets Likely to React to Consumer Confidence

Consumer Confidence readings often influence equity, currency, and bond markets in SI. The following tradable symbols historically correlate with shifts in consumer sentiment, providing useful barometers for investors and policymakers alike.

• ABC – A leading consumer discretionary stock sensitive to household spending trends.
• EURSIUSD – The SI currency pair, reflecting macroeconomic sentiment and capital flows.
• BTCSI – A crypto asset showing risk appetite shifts linked to consumer confidence.
• DEF – A major retail sector stock impacted by consumer spending changes.
• USDSISI – A currency pair reflecting cross-border trade and investment sentiment.

Insight: Consumer Confidence vs. ABC Stock Since 2020

Since 2020, the Consumer Confidence index and ABC stock price have shown a strong positive correlation (r=0.72). Periods of rising confidence typically coincide with ABC’s stock rallies, reflecting consumer discretionary spending power. For example, during the early 2025 confidence dip to -31, ABC’s share price declined 15%. Conversely, the recent confidence rebound to -23 has supported a 7% gain in ABC shares over the past month, underscoring the stock’s sensitivity to sentiment shifts.

FAQs

What does the latest SI Consumer Confidence reading indicate?

The index at -23 suggests cautious optimism among consumers, improving from prior months but still below neutral levels.

How does Consumer Confidence impact SI’s economy?

Consumer Confidence influences household spending, which drives over half of SI’s GDP, affecting growth and inflation dynamics.

What are the main risks to Consumer Confidence in SI?

Key risks include persistent inflation, monetary tightening, fiscal austerity, and geopolitical tensions that could dampen sentiment further.

Takeaway: SI’s Consumer Confidence is on a slow recovery path but remains vulnerable to inflation and geopolitical risks. Policymakers and markets should prepare for a range of outcomes as the economy navigates these headwinds.

This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.