Consumer confidence dives as Budget fears grow
RETAILERS have blamed the Government for frightening people about another severe Budget after consumer confidence dived last month.
The consumer sentiment index produced by KBC Bank and the Economic and Social Research Institute fell to 60.2 in September after hitting a a near five-year high of 70 in August.
The index is now at its weakest level since February. KBC Bank's Austin Hughes said tax rises and expenditure cuts had consumers rattled.
"There is little doubt that confidence amongst Irish consumers weakened significantly last month. We think this reflects a number of factors," he said.
The economist said that consumers are beginning to calculate the probable impact on their household finances of substantial cuts in health and welfare spending and a new property tax. They are also having to deal with looming increases in energy bills.
"For most of the past nine months, the improvement in sentiment reflected a gradually broadening view that the worst might be over," he said.
"The September survey results suggest consumers are no longer sure that is the case."
Mr Hughes called on the Government to set out what it planned for the Budget to reduce uncertainty among householders.
David Fitzsimons, CEO of Retail Excellence Ireland, said: "It is important that the Government only comments when a decision is made and that commentary is made with clarity and authority."
The fall in consumer confidence comes after an official European Commission report found the drop in household income in Ireland was the second worst between 2009 and last year. Incomes fell 9pc here, with only Greece experiencing a bigger drop.