Ireland: Consumer confidence retreats from multi-year high in October
October 6, 2014
The KBC Bank Ireland/ESRI Consumer Sentiment Index fell 7.3 points in October over the previous month to reach 85.5. September had marked the highest mark since the start of 2007, while this month’s result was the weakest in four months. However, according to the survey report, “it is possible that the October results are simply a statistical ‘blip’. Such an outcome is made more likely by the particularly volatile and still somewhat uncertain circumstances facing the average Irish consumer.”
The decline in October was driven by a deterioration in consumers’ perceptions of the current economic environment as well as in their outlook for the Irish economy. The current economic conditions index decreased as consumers were less upbeat about their current situation and the prospect of purchasing goods, likely due to ongoing strains on household finances. The consumer expectation index also fell, with consumers less optimistic about the labor market and their financial situation over the next 12 months. The results are consistent with many consumers’ experience of waiting for the economic recovery seen at a national level to spill over and improve the conditions they are facing firsthand.
Author: Carl Kelly, Economist