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Financial advisers in Singapore more optimistic about the global economy than those in Hong Kong
Singapore's confidence level is 7.5 out of 10.
Financial advisers operating in Asia feel significantly more confident about the state of their local economies than the global economy, according to the international adviser confidence barometer conducted by Royal Skandia, part of Old Mutual Wealth.
The average confidence level amongst international advisers towards their local economies now stands at a 12 months high of 6.8 out of ten, compared to 5.8 out of ten for the global economy. This is in contrast to other regions surveyed, who on average were more confident about the state of the global economy than regional ones.
Whilst Asian advisers believe the outlook for the global economy may not be as positive as the outlook for their local regions, their confidence levels in the global economy has still increased from 5.2 at Q3 and is now at a yearly high of 5.8 out of ten.
Advisers operating in Singapore have been reporting improvements in sentiment towards their local economy throughout the whole of 2012, registering a further increase in confidence this quarter, up from 6.8 out of ten at Q3 to 7.5 now.
Not only are Singaporean advisers optimistic about their local economies, they are increasingly positive about the global outlook, and have gone from reporting the joint lowest confidence score (with European advisers) at Q3 of 5 out of ten to the highest at the close of the year (6 out of ten).
In contrast, advisers from Hong Kong are less positive about the global economy and have reported a confidence level of 5.6 out of ten - slightly lower than the global average of 5.8.
The increasing optimism for the global economy seems to be reflected in a shift in economic concerns for Asian advisers. The European Debt Crisis and global contagion have been perceived as the biggest threats to the economy over the last year; however, as we enter 2013 they are no longer the primary concerns for advisers in the region.
Inflation was selected by half of Asian advisers as the biggest threat to economic stability, indicating that the steps being taking across Europe and North America to promote economic growth have started to boost sentiments towards the global economy. Interestingly the concern over inflation is particularly high for advisers in Singapore despite their confidence in their own economy, with over two thirds (69.2%) perceiving it to be the biggest market threat.
Not only do Asian advisers believe the major economic threats have changed, they also believe that the biggest business challenges over the next year have altered. In Q3 over half (56%) of Asian advisers selected market volatility as the biggest likely threat to their businesses; now the focus has shifted towards the rising costs of running a business, with over a quarter of advisers (29%) fearing this to be the most significant challenge for the industry going forward.
Craig Ellis, head of region in Singapore and SE Asia at Royal Skandia comments:
”It is good to see that Asian advisers are growing steadily more confident about the state of their local economies and that they are increasingly positive about the global economy - this appears to be particularly true in Singapore. It appears that Asian advisers are now less anxious about the effects of global contagion and are focusing their concerns on local economic issues such as inflation going into 2013.”
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