Irish consumer morale plunges

 

Consumer confidence in December plunged to its lowest levels since the depths of the financial crisis, new figures show.

The results from the latest Consumer Market Monitor - compiled by UCD Smurfit Graduate Business School and the Marketing Institute of Ireland - show that in the last three months of 2011, consumer confidence dropped dramatically and was down 28 per cent from the middle of last year.

The December figure of -32 was on par with the lowest point in consumer confidence registered in the depths of the financial crisis in 2008/2009.

The figures show that consumer spending continued to trend downward last year, declining drastically in the last quarter. Retail sales also declined in the year, with drop in volume of 2.7 per cent and a drop of 1.8 per cent in value.

While bar sales fell by 4.6 per cent in volume and spend on fuel dropped by 1 per cent, the number of cars sold was up by 18 per cent.

Irish consumers continued to pay off debt with total household credit now down to €110 billion, a fall of 48 per cent from a peak of €212 billion in 2008.

Professor of marketing at UCD Smurfit School Mary Lambkin said the dramatic drop in confidence in Q4 2011 was down to “continued austerity measures, although it is undoubtedly also influenced by the uncertainly in the Eurozone.”

Prof Lambkin said the figures made it clear that it was “unhelpful to publish a government budget in a month which should normally be the highest spending period of the year”.