Consumer sentiment weakened again in June as the prospect of higher interest rates darkened the mood of Irish consumers, according to a survey released today.
The overall IIB/ESRI Consumer Sentiment Index stood at 89.4 in June compared to 92.3 in May. The corresponding figure for June 2005 was 99.6.
ESRI economist David Duffy said the weakening sentiment shows that consumers have become much more concerned about the outlook for the labour market and the economy over the next 12 months.
"Consumers feel that economic news has been negative over the past month, particularly citing higher prices and increasing interest rates," he said.
IIB's chief economist, Austin Hughes, echoed the Mr Duffy's comments on the survey by saying that interest rate worries continue to unsettle Irish consumers.
"The June results suggest that consumers have already downgraded the likely impact on their household finances, but they have become more worried about the broader economic impact of late," he said.
However, the news was not all downbeat as the index of current economic conditions improved to 106.3 from 103.4 in May. "Presumably, many consumers still feel they have the financial wherewithal to hunt for bargains in the summer sales," Mr Hughes said.