Ireland: Irish consumer confidence recovers in August from Brexit vote shock
September 7, 2016
In August, the KBC Bank Ireland/ESRI Consumer Sentiment Index increased from 99.6 points in July to 102.7 points, nearing the pre-Brexit reading of 103.4 in June, which points to a partial recovery in Irish consumers’ sentiment. August’s reading was the result of Irish consumers’ reassessment of the extent and timing of the damage the Brexit vote may have on the Irish economy. Although four of the seven components remain entrenched in pessimistic territory, the overall index improved on the back of a reinforced perception of both their current conditions and future personal finances, though the report highlighted that consumers remain cautious regarding the outlook of the Irish economy.
A closer look at August’s reading points to an improving outlook for unemployment, with job announcement volumes on the rise and several hiring plans by large companies currently underway. Irish consumers’ perceptions of the general economic outlook also improved, although this component still lagged behind the rest of components. Nonetheless, their current conditions eased slightly amid heightened risks stemming from domestic uncertainty, while consumers’ financial assessment of the past twelve months declined markedly.
KBC also stated that, “The pick-up in the views on the Irish economic outlook largely reflected the absence of any dramatic indications of a Brexit related deterioration in Irish economic conditions during the survey period but encouraging Census data and the generally positive response to the Government’s Action Plan for Housing and Homelessness may also have contributed to some easing in concerns about the economic outlook.”