Paul Arithi 
Award Winning Fund Manager ICEA LION Asset Management releases the First Quarter 2024 ILAM Consumer Spending Index “Individual spending rises but retail business sales lag”
East Africa’s pioneering investment management firm ICEA LION Asset Management launches the ILAM Consumer Spending Index, with the theme ‘Individual spending rises but retail business sales lag’
Speaking at the event, Judd Murigi,Head of Research at ICEA LION Asset Management highlighted the following key trends:
• Income trends improve
Half of respondents indicated static income levels over the last year,while one quarter reported increased income and reduced income respectively.
This was an improvement from 2023 when almost 40% of respondents reported a decline in income over the previous 12 months.
• ILAM Consumer Spending Index rises in 4Q23 but falls in 1Q24
The ILAM Consumer Spending Index rose by 18% to 116 in the final quarter of 2023 and fell by 5% to 110 in the first three months of 2024.
The index base of 100 is based on consumer spending in Nairobi trends in 2Q23 and had initially fallen to 97 in 3Q23
• Individual spending trends improve
Individual spending trends rose by 36% between October and December 2023 and a further 6% in January to March 2024
There was a significant improvement noted in individual spending trends in 4Q23, driven mainly by women and consumers aged between 18 and 35. The rise in spending was largely attributed to higher cost of items purchased.
In terms of socio-economic categories, the lower income segment recorded the strongest improvement in spending trends in 88% of respondents made purchases using their own income, while 12% relied on credit.
• Retail business sales trends lag
Retail business sales trends improved by 6% the final quarter of 2023 but declined by 15% in the first quarter of 2024
The rise between October and December, driven by higher customer traffic and higher individual customer spend,while the decline in January to March was especially in the clothing retail and food & beverage outlets.
In closing, ICEA LION Asset Management CEO – Einstein Kihanda, who is also the immediate former Chairman of the Institute of Certified Investment and Financial Analysts (ICIFA) summarized thus: “Individual spending trends exhibited positive trends while retail business sales came under pressure in the first quarter of 2024”
