Irish consumer sentiment recovered in January, as concerns about the severity and duration of difficulties posed by the Omicron COVID-19 variant eased, research shows.
According to the latest KBC Bank consumer sentiment survey for January, this prompted a reversal of most of the weakness seen in December.
Also, as the survey was completed by 15 January, it doesn’t capture the substantial removal of lockdown restrictions announced on 21 January.
“The positive tone of the January sentiment survey suggests scope for a marked further improvement in Irish consumer confidence in February, on what amounts to the effective reopening of many entertainment- and hospitality-focused sectors,” commented Austin Hughes of KBC Bank.
Euro Area Concerns
The survey indicated that Euro area consumers previously appeared to have been quicker than their Irish counterparts to declare an end to pandemic concerns and lockdowns.
As a result, the combination of a renewed increase in infection rates and sharply higher living costs has taken a significant toll on confidence of late.
“While we expect strong growth in consumer spending in the coming year, the relatively guarded tone of the sentiment survey would argue against expectations of a frenzied consumer boom in 2022,” Hughes said.
“In this context, encouraging as stronger spending growth in the next couple of years should be, this largely represents a likely incomplete catch-up with the trend growth in consumer spending prior to the pandemic,” he added.