Ireland: Consumer confidence drops marginally in September
October 10, 2016
In September, the KBC Bank Ireland/ESRI Consumer Sentiment Index dropped from 102.7 points in August to 102.0 points. Growth in consumer spending remains solid and the drop is considered to be marginal and not statistically significant. Nevertheless, a breakdown of the result suggests that Irish consumers face growing uncertainty and difficulty in assessing the country’s economic outlook.
The monthly reading was dragged down by domestic factors rather than global ones. Irish consumers grew more pessimistic regarding the country’s economic outlook and their employment prospects. Their assessment of their personal finances was mixed, as they see their personal financial situations deteriorating in the coming year but consider them to have improved notably since one year ago.
Since the rate of decline of most sub-indicators was modest overall, the report added that the monthly result does not reflect a dramatic change in the ability or willingness of Irish consumers to spend of late, but rather their growing apprehension due to a series of factors such as Brexit-related uncertainty and the upward revision of Ireland’s national account. These factors have made it difficult for consumers to assess the implications of ongoing economic developments on their lives. In this climate of increased nervousness, KBC suggested that, “the sentiment survey emphasizes the need for the upcoming Budget to gently support rather than shock Irish consumers.”