Irish Consumer Sentiment Raised Higher In July

According to the latest report by the Credit Union consumer index, Irish consumer sentiment has risen for the past 2 1/2 years. Consumer sentiment is understood as the consumer mood for buying goods and services in the current economy.

The Union acknowledges the ease in cost of living in Ireland and continuous improvements in the economy. It has led the consumers to put more confidence in the country’s well-being, leading to boosted consumer attitudes.

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A hike in consumer buying behaviour was observed by the researchers. An enhancement in their current financial conditions was noted due to improved wages and higher prospects for the upcoming year.

Being more positive about the country’s economy is another prime factor in the change of their positive attitude. The general outlook of employment has changed for consumers, which makes them more confident in making purchases and maintain their desired quality of living.

Also, the survey revealed that there is an increase in intentions to make plans for the holidays. The highlighted cause is an increase in the sentiment reading from 70.5 in June and currently being at 74.9. The long-term average is still quite high, which is 84.4.

However, the consumer sentiment reading for the month of July remains below in comparison with the long-term average. The survey proposed a caution looking among the Irish consumers, despite the 2 1/2 year surge in consumer mood.

The consumer appears to be burdened by the economic costs. The spending climate of the country has eased a bit, possibly due to a greater focus on travelling and spending holidays with loved ones. July is the second consecutive month that has seen such an uplift since it was not present earlier in the months of February, March, April and May.

Furthermore, the financial and travel constraints in the past had put a restriction on the consumers for travelling. Now, since the situation has eased, extra spending on travelling might have stimulated the consumer sentiment again, but temporarily.

A positive prediction in the survey implies that if the Irish economy continues to improve, then the next month’s consumer sentiment index will improve, matching the long-term average for the entire year. Consumer spending is also expected to boost towards the end of this year.

During the past 2 1/2 years, an overall improving consumer sentiment is also attributed to a slight slip in the US. Even though the survey was finished before Joe Biden withdrew from the contest, there still seemed to be a “feel good factor”. A circumstantial melioration in the Eurozone and fractional upgrade in the United Kingdom gave rise to the consumer sentiment based on Euro 2024.

What is Consumer Sentiment Index?

The consumer sentiment index is conducted throughout the world in almost 45 countries. These are consumer confidence surveys that had information gathered from the households. The index is calculated to help government policymakers and business leaders predict consumer attitudes and perceptions about future buying.

The same is reported in Ireland. The linking of consumer confidence with consumer growth or spending is a strong explanation of the country’s economic growth. Retail spending and expenses on other leisurely activities like planning vacations have a huge impact on the entire buying climate.

The economist, Austin Hughes anticipated that people are trying to escape the weather, which is a high probability for their vacation planning. This factor has led retailers to put discounts on summer sales, giving a direct thrust to the consumer sentiment index. Hughes added that decreasing prices of food and energy in June was the prominent factor of the survey.

In the upcoming years, consumer spending on public services is likely to increase. Extra precautions are in line to strengthen the ‘still’ fragile consumer sentiment with financial developments in the later half of the year.