CONSUMER CONFIDENCE in the economy improved slightly in September despite the triple whammy of lay-off announcements, the Nama controversy and the Commission on Taxation report, according to the latest sentiment index from KBC Ireland and the Economic and Social Research Institute (ESRI).
“Although the mood of the average Irish consumer remains fairly downbeat, there have been signs in recent months that consumers are starting to detect some faint glimmers of light through the economic gloom,” said Austin Hughes, economist at KBC Bank Ireland.
“The pick-up in Irish consumer sentiment in September was a good deal less dramatic than that seen in a range of other countries as signs of improving economic conditions have all but ended fears of a global economic apocalypse,” he said.
Significant Irish job losses were announced last month at Teva, UPS, Friends First, Irish Flavours and Fragrances, Georgia Pacific and Johnston Press, among others.
However, there was a notably slower pace of increase in the number of people joining the Live Register of unemployment benefit claimants.
Mr Hughes said it appeared that many workers were factoring in potential job losses when assessing the outlook for the jobs market.
“Lay-off announcements no longer represent the sort of shock they did at the beginning of the year.”
He added that it was “surprising” that September’s consumer sentiment index also recorded a more positive assessment among consumers of both the broad economic outlook and their personal finances in the next 12 months.
David Duffy, economist at the ESRI, said seven out of 10 consumers remained concerned about how their household finances had developed over the past 12 months.
Consumers’ view of the climate for buying big ticket items also weakened in September.
“Sentiment may be stabilising but there seems little prospect of a marked rebound in consumer spending,” Mr Hughes said.
However, the critical Christmas spending season “may not be quite as dreadful as previously feared”.
