The results of the Byblos Bank/AUB Consumer Confidence Index for the fourth quarter of 2018 show that the Index regressed by 0.9% in October from the preceding month, declined by 0.8% in November and increased by 5.3% in December 2018. The Index averaged 75.5 in the fourth quarter of 2018 and was nearly unchanged from 75.3 in the third quarter of the year. In addition, the Byblos Bank/AUB Present Situation Index averaged 66.7 in the fourth quarter of 2018 and increased by 1.1% from the preceding quarter, while the Byblos Bank/AUB Expectations Index averaged 81.4 and was nearly unchanged from the third quarter of 2018. Further, the average monthly score of the Index in the fourth quarter of 2018 was 28.6% lower than the quarterly peak of 105.8 registered in the fourth quarter of 2008, and remained 22% below the annual peak of 96.7 reached in full year 2009. 

The stagnation in household sentiment during the fourth quarter of 2018 reflects the ongoing political impasse that has prevented the formation of a new government in Lebanon more than seven months after the May 2018 parliamentary elections. However, the flood of rumors and scare tactics since the summer about the impending collapse of the Lebanese economy and of the national currency did not succeed in triggering broad panic among citizens. In fact, the momentum in confidence evaporated soon after the elections, but the Index held steady during the third and fourth quarters, instead of dropping materially during this period.

The fourth-quarter results show that 9.6% of the Lebanese polled in the fourth quarter of 2018 expected their financial conditions to improve in the coming six months, down from 11.5% in the third quarter of the year. In parallel, 57.9% of respondents in the covered quarter believed that their financial situation will deteriorate, nearly unchanged from 58.1% in the previous quarter, while 29.8% forecast their financial condition to remain the same in the next six months compared to 28.2% in the third quarter of 2018. In addition, 9.6% of the Lebanese surveyed in December 2018 expected business conditions in Lebanon to improve in the coming six months compared to 10% in September 2018, while 65.8% of respondents anticipated business conditions to deteriorate, relative to 67.4% in September.