The overall KBC Ireland/ESRI Consumer Sentiment Index weakened to 48.7 in August. This compares to a figure of 49.5 in July 2009, and to an all time low of 39.6 reached in July 2008.
Commenting on the results David Duffy, ESRI, said
- “The results for August show a moderate weakening in consumer sentiment. The forward-looking sub-index declined to 28.6 in August, from 30.6 in July. One of the main reasons behind the decline is that consumers continue to be negative in their perception of the outlook for the labour market.”
- “In contrast, the index of current economic conditions rose marginally to 78.6 in August from 77.6 in July. This reflects consumer’s becoming more positive about the current buying climate.”
- “Consumers remain concerned about their current and future household financial situation.”
In addition, Austin Hughes, KBC Ireland, noted:
- ‘It is slightly surprising that we didn’t see a much sharper deterioration in August given significant redundancies, major cutbacks in spending proposed by an Bord Snip and controversy about NAMA. It may be that consumers had already braced themselves for this sort of bad news. It could also be that they are keen to see some plan of action even if it isn’t perfect and of course they may be hoping that an improvement in other countries will limit the downside for Ireland’.
- ‘A surprising aspect of the August results is an improvement in the buying climate. This probably reflects a response to heavy discounting in the summer sales but it may also hint that the freefall in consumer spending could be coming to an end’.
Note:- Since May 2008 the KBC Ireland/ESRI Irish consumer sentiment survey was prepared using a slightly different methodology. While this may have a minor impact on the precise numerical estimates of various survey components, it should not have any significant effect on the broad trend reported.
For further information contact:
Austin Hughes, KBC Bank Ireland @ 664 6889 (office) or 087 669 6972 (mobile)
David Duffy, ESRI @ 863 2000 (office) or 087 219 6950 (mobile)
