According to a report from the KBC Bank Ireland Consumer Sentiment Index, optimism over the reopening of society has driven Irish consumer confidence to the highest levels in 23 months.
The increase moves the sentiment index modestly above pre-pandemic levels and suggests consumers anticipate a strong post-Covid Irish economy.
Post-Covid Re-Opening
This improvement in Irish consumer confidence raises sentiment to the highest level seen since June 2019.
The main reason for the improvement is suggested to be the post-Covid re-opening of retail and hospitality in the coming weeks.
The overall picture of the Irish economy is healthy, but it is believed that vaccinations and a lower rate of cases are amongst the main drivers in the uptick in optimism.
According to KBC, May saw a "clear easing of nervousness about household finances", with one in six households expecting their financial circumstances to improve in the coming year.
However, it remains the case that one in four felt their circumstances had worsened compared to one in ten reporting their personal financial circumstances had gotten better in the past year.
Jobs
Another area for positivity for the Irish consumer was the job market, which experienced the sharpest improvement, presumably was driven by the prospect of a return to work in a range of sectors.
In addition, a steady stream of new job announcements continued, underpinning expectations for a materially brighter outlook for employment.
As a result, the jobs component of the sentiment survey saw the first positive balance (technically, more respondents expecting unemployment to fall than to increase) since June 2019.
Elsewhere, working from home and large fiscal supports ensured that at the aggregate level, household incomes continued to rise in 2020, implying an immediate financial hit from the pandemic was limited for the majority of Irish consumers.
© 2021 Checkout – your source for the latest Irish retail news. Article by Conor Farrelly. Click sign up to subscribe to Checkout.
