Strong increase in June sentiment survey suggests Irish consumers sense brighter days ahead
June 28, 2024
The consumer mood improved this month, according to the latest Credit Union Consumer Sentiment Survey, on the back of lower fuel costs and an ECB rate cut.
The latest index shows that after months of weak data, the pick up in June has been big enough to undo half of the declines that had been seen in the previous four months.
The latest survey, in partnership for Core Research, shows an index reading of 70.5 for June, up materially from the May figure of 65.7.
The June reading marks the first monthly increase since January following four successive monthly declines between February and May, but its current level remains some distance below the long-term series average of 84.5.
The report’s author, economist Austin Hughes, points to the European Central Bank’s cutting of interest rates as one of the drivers of the better mood.
Falling energy costs also helped, while households also seemed to have a better outlook about their own finances and the direction of the economy as a whole.
The survey suggested that consumers seem to be seeing a bit of light at the end of the tunnel, adding that it may not take much for the mood to improve further in the months ahead.
A separate part of the survey included special questions about how people have weathered the cost-of-living crisis, and this shows that there is still a long way to go for people to actually be out of the worst of it.
Just four in ten consumers say their household income is now above their living costs.
About a third say their household income is broadly in line with their spending at the moment – while a quarter say their income does not cover their spending.
Austin Hughes also said that the improvement in consumer sentiment in June here coincided with a marginal improvement in consumer confidence across the euro zone and a marked improvement in UK consumer confidence.
“The improvement in Irish consumer sentiment in June suggests an increasing sense that financial pressures are set to ease further in the next 12 months. How exactly and to what extent that occurs remains to be seen,” Mr Hughes added.
David Malone, CEO of the Irish League of Credit Unions, said that the clear improvement in consumer sentiment in June is very encouraging after what has been a challenging period for most Irish households.
“Whether consumers are still dealing with difficulties from the cost-of-living crisis or now thinking about holidays or home improvements, their local credit union is on hand to help them on their financial journey,” he added.
