Uncertain Economic Outlook Keeps Irish Consumers Cautious
Irish consumers have remained cautious in the face of uncertain economic conditions, contrasting with changing attitudes in other areas, according to the November Consumer Sentiment Index, released by the ESRI on Thursday, December 1.
The consumer sentiment index rose slightly to 97.8 in November, compared with 97.3 in October. However, it remains lower than the 103.1 recorded in November 2016.
The details of the November survey hint that Budget 2017 may have been seen as offering some support to household spending power but this impact was relatively modest and largely offset by concerns about the broader economic climate. The broader message of the sentiment index is that Irish consumers are having considerable difficulty in assessing the extent to which their circumstances might improve or worsen in the coming year.
Commenting on the report, the ERSI wrote: “November saw the largest monthly increase in US consumer sentiment since December 2013. This largely reflected a jump in expectations about the future in the wake of Donald Trump’s Presidential election victory and, as such, underscores the sense of detachment many consumers have felt from an improving US economy in recent years and the associated appeal of ‘populist’ rhetoric.
“In contrast, UK consumers became notably gloomier in November, with the GFK index posting the second largest monthly drop (after July’s post-referendum slump) since November 2012. This seems to reflect a notably more pessimistic view of UK economic prospects over the next twelve months that likely owes something to fears of notably higher inflation and correspondingly diminished purchasing power as well as growing uncertainty about the precise exit path for the UK from the EU.”