Heatwave boosts sales as Irish consumer confidence up
THE recent bout of good weather has not only lifted the mood of the nation but it appears to be boosting consumer confidence as well, according to the latest consumer sentiment figures.
While noting that a “combination of economic factors seems to have prompted this change”, Austin Hughes, Chief Economist for KBC Bank Ireland believes the rise in consumer sentiment from 61.2 in May to 70.6 in June may be partially attributed to the feelgood factor due to the spate of good weather in early June.
“Worries about a global financial meltdown seem to have all but disappeared of late while signs of a still fairly restrained improvement in economic conditions have begun to build. In these circumstances, consumers’ worst fears are slightly fading, prompting a spate of slightly less pessimistic confidence readings,” he said of the latest KBC Bank Ireland/ERSI Consumer Sentiment survey.
Although we are not out of the recessionary woods yet, he noted that all five elements of the Irish consumer sentiment survey showed improvements over May.
The biggest change was noted in consumers’ assessment of the state of the jobs market, which appears to reflect continuing gains in employment figures and new jobs announcements, he said.
“As a result, the share of respondents who see unemployment rising in the next twelve months dropped to just 33pc —the lowest reading since December 2004 while the number expecting a decline rose to just under 28pc - the strongest reading since mid-2005,” he said.
But unrelated factors, such as the weather, seem to have also influenced the mood of respondents, he added.
“A good deal more work is needed in this area but our preliminary results suggest that while we talk a lot about the weather there isn’t a continuous link between weather conditions and Irish consumer sentiment- perhaps this says we’re attuned to a fickle but generally temperate climate. However, on the odd occasion that we experience a prolonged spell of exceptionally good weather it does seem to lift the mood of the Irish consumer,” he added.