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02/10/2012
Consumer Confidence Dropped In September
Irish consumer confidence dropped sharply in September as the government began debating another austerity budget
The KBC Ireland/ESRI Consumer Sentiment Index dropped to 60.2 in September from 70.0 in August.
The news has knocked back hopes that more stable state finances would help boost high street spending.
The decline is the greatest since fears about the euro zone's future began to take hold late last year.
It leaves the index at its lowest level since February.
Dublin is currently seeking a way out of its debt problems and, with unemployment increasingly high across the Continent, the government will need to ease this economic decline.
Media speculation regarding a new household tax and cuts to social security and health spending in December’s Budget have unnerved consumers, according to the survey’s authors.
"The September survey suggests the fear factor has returned as consumers worry about the possible impact of another severe budget on already strained household spending power," said KBC chief economist Austin Hughes.
"The improvement in confidence thus far in 2012 was tentative and fragile in nature... built largely on a gradual easing in concerns ... rather than any dramatically positive news."
But he did admit the fall may have overstated the change in the mood of consumers.
The fall in Irish consumer confidence mirrors that of consumers across Europe, which fell in September as a result of government lay-offs, budget cuts, record joblessness and high inflation.
(IT/GK)
The KBC Ireland/ESRI Consumer Sentiment Index dropped to 60.2 in September from 70.0 in August.
The news has knocked back hopes that more stable state finances would help boost high street spending.
The decline is the greatest since fears about the euro zone's future began to take hold late last year.
It leaves the index at its lowest level since February.
Dublin is currently seeking a way out of its debt problems and, with unemployment increasingly high across the Continent, the government will need to ease this economic decline.
Media speculation regarding a new household tax and cuts to social security and health spending in December’s Budget have unnerved consumers, according to the survey’s authors.
"The September survey suggests the fear factor has returned as consumers worry about the possible impact of another severe budget on already strained household spending power," said KBC chief economist Austin Hughes.
"The improvement in confidence thus far in 2012 was tentative and fragile in nature... built largely on a gradual easing in concerns ... rather than any dramatically positive news."
But he did admit the fall may have overstated the change in the mood of consumers.
The fall in Irish consumer confidence mirrors that of consumers across Europe, which fell in September as a result of government lay-offs, budget cuts, record joblessness and high inflation.
(IT/GK)
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