Ireland saw a “slight dip” in consumer confidence last month, which is already “well below” average even as shoppers in the US, UK and elsewhere in Europe grew more confident in their daily spending habits.
Findings from the Irish League of Credit Unions (ILCU) suggest “continuing concerns around pressures of living costs as well as an uncertain economic outlook” at home and abroad have resulted in “consumer sentiment [falling] marginally in July”.
A reading above 50 on the consumer sentiment index signifies growth in consumer confidence.
July’s result was recorded at 61.6, a “slight and statistically insignificant drop” from 62.2 the previous month, although “well below the long-term survey average of 83.2″, according to the ILCU’s report.
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The average figure in the index over the last 12 months is 60.5, with this month’s “effectively unchanged” figure “implying that the pressures now facing Irish consumers are not entirely new”, Austin Hughes wrote in the report.
“The July sentiment period did see a good deal of negative news on the outlooks for jobs,” he said, “with a further spate of lay-off announcements including high-profile job losses at Aer Lingus, TikTok and some Microsoft subsidiaries.”
‘Disappointing but not entirely surprising’
This was not helped increases in global energy costs and “the sense of a marked deterioration in the prospects of a near-term peace deal in the Middle East”, he said.
The chief executive of the Irish League of Credit Unions, David Malone, described the results as “disappointing but not entirely surprising”.
“What stands out in this month’s finding is that concerns about the cost of living continue to outweigh all other economic issues by a significant margin,” he said.
“Despite some positive economic development in recent months, many consumers remain focused on the day-to-day realities of managing household budgets.”
“The slight fall in Irish consumer sentiment was at odds with a sharp and broadly based improvement in US consumer sentiment, a third consecutive month of improvement for euro area consumer confidence and a significant recovery in UK consumer confidence,” Hughes said.
Possible reasons for Ireland’s outlier position are that most of the US survey was completed before the country renewed its strikes on Iran, a “Burnham bounce” in economic expectations and many European teams’ strong showing in the World Cup, the report said.
The monthly survey of 1,000 Irish adults, conducted by Core Research, showed 42 per cent of consumers listed cost-of-living pressures as the most pressing economic issue the country could face in the next two years.
This was an increase of five percentage points from the number of people who thought so the previous year. Some 15 per cent of respondents saw housing as the most pressing issue, a decrease of four percentage points from last July.
