Consumer Sentiment falls in February

The overall KBC Ireland/ESRI Consumer Sentiment Index decreased from 108.6 in January to 105.8 this month. The 3-month moving average did however; increase this month from 105.2 in January to 106.1.

Commenting on the results Daniel Foley, ESRI, said

• “The consumer sentiment index fell in February after significant increases in recent months. The underlying trends for the main indices continue to point upward suggesting that confidence is still broadly positive. The results reflect a more cautious outlook by consumers.”

• “Overall views in relation to consumers' expectations seemed to disimprove in February compared to January. There were falls in the components relating to the outlook for the labour market and economic conditions over the next 12 months. Interestingly, the changes were not driven by an increase in negative responses but by increases in neutral responses perhaps reflecting increases in uncertainty rather than worsening perceptions about the economy. The net effect was a fall in the index of consumer expectations to 95.5.”

• “The buying climate worsened slightly in February following a significant improvement in January indicating that households feel more uncertain with regard to decisions involving major household purchases. A more moderate result was expected this month given this component tends to improve significantly every January due to winter sales. Once again the result is driven by an increase in neutral responses rather than an increase in negative responses. The proportion of negative responses actually declined marginally by 2 per cent.”

• “This contributed to an overall marginal fall in the index of current economic conditions from 121.4 in January to 121.0 this month.”