Consumer sentiment rises for second month in a row
Consumer sentiment rose strongly for the second month in a row to reach its highest level since the Covid-19 pandemic took hold after the reopening of large parts of the economy at the start of December, a survey found today.
The KBC Bank Ireland consumer sentiment index rose to 74.6 in December from 65.5 in November.
That compares with a pandemic low of 42.6 in April during a complete lockdown of the economy and was not far off a mark of 81.4 a year ago before the COVID-19 crisis.
Data has shown that much less damage was done to the economy during the six weeks of restrictions to the end of November compared with an initial lockdown.
Credit and debit card spending has risen sharply since the reopening, Central Bank figures have shown.
KBC Bank Ireland said the survey results may suggest consumers believe the worst of the pandemic is behind them, but that they are still overwhelmingly cautious about the outlook for their household finances in the year ahead.
The bank added that 41% of respondents said they had less money for Christmas spending than last year and roughly the same replied that their situation was unchanged.
“Our sense is that these numbers will translate to a solid if unspectacular Christmas period in terms of consumer spending,” KBC Bank Ireland’s chief economist Austin Hughes said.
He said the survey results suggests that caution and constraints, both on spending power and social contacts, mean that consumers are unlikely to simply compensate for lower spend in areas such a entertainment by higher spend on areas such as presents.