Consumer sentiment reached a seven-year high in July this year, according to the KBC Ireland/ESRI Consumer Sentiment Index.
The index currently stands at 89.4, compared to 81.1 in June, which is the highest recorded consumer sentiment since July 2006. Additionally, the three month moving average rose to 83.3 from 82.6 in June.
David Byrne, ESRI, commented on the results: "The increase was driven both by improving perceptions of the current economic environment and expectations for the future. The index of current economic conditions rose to 103.5, from 95.8 in June. This is the highest level recorded since July 2006."
Byrne said that households were more positive about the current buying climate, while households were shown to be more positive in their views of the economy, the labour market and in their expectations for their financial situation over the next 12 months.
Austin Hughes, chief economist at KBC Bank Ireland, commented: "The rise in the index suggests sentiment remains on a generally improving trend. The sharp rise in the sentiment survey last month continues the notably more volatile pattern seen of late, as consumers struggle to make sense of strongly conflicting signals on the health of the recovery and what that might mean for their personal finances."
Hughes said that the confusion felt by consumers and signalled by "choppy" movements in the sentiment index seems to be the result of a disconnect between increasingly upbeat commentary on the current state of the Irish economy and continuing pressures on their household finances. He said, "For many, the recovery they are hearing about is not one they are seeing in their own circumstances."
The Consumer Sentiment Index, the Index of Consumer Expectations and the Index of Current Economic Conditions remain at levels equal to the first half of 2007. The Index of Consumer Expectations is based on consumers’ perceptions of their future financial situation, their economic outlook for the country as a whole and employment expectations.
© 2014 - Checkout Magazine by Genna Patterson