Irish consumer sentiment slumps back to February levels
Consumers are as down about the economy as the were last February – as recent boosts like visits of Queen Elizabeth II and US President Barack Obama seemed to have little impact on confidence.
Householders are more negative about their family finances with a July interest rate hike by the European Central Bank almost definite, according to a new survey by KBC Bank and the Economic Social and Research Institute (ESR) which showed sentiment fell to 56.3 in June, compared with 59.4 in May.
KBC economist Austin Hughes said the drop was not surprising as consumers are also expected to take a further hit in the December budget.
“The June sentiment survey is disappointing but not entirely surprising,” said Austin Hughes, KBC chief economist.
“While Irish consumers are adapting to tougher conditions, they face a wide variety of pressures ranging from job worries to a continuing squeeze on spending power that higher ECB interest rates in July and household charges in 2012 will make even more difficult.”
And it’s the future that consumers are focusing on.
“The decline is mainly due to consumer concerns about the future,” said David Duffy, an ESRI economist. “Consumers perceptions about the current environment only showed a marginal decline.”