Irish confidence on rise as UK consumers cut costs, according to research

Ireland is now the fourth most confident country in Europe with consumer sentiment here higher than in the UK for the first time in nearly nine years, according to market research firm Nielsen.

In its latest quarterly global survey of consumer confidence and spending intentions, Nielsen said Ireland is currently at positivity levels not seen since the end of 2007; with nearly 60% of people feeling upbeat about their personal finances and their job prospects.

“Increasing consumer confidence has been a continuing trend in Ireland over the last few years due to a steady improvement in the Irish economic situation. This increase in confidence has translated to consumers spending more on groceries, driving both volume and value growth in the sector,” said Matt Clark, Nielsen’s commercial director for Ireland.

Nielsen noted that more Britons tried to rein in their spending in the second quarter of this year than at any time since 2015 as rising inflation squeezed household incomes. Some 53% of Britons scrimped between April and June — the highest proportion since 56% did so during the same period of 2015, Nielsen said.

This marked a swing back towards household cost-cutting, in the UK, over the past year, which had been at its lowest level on record, 40%, in the two months after the Brexit vote in June 2016.

But sterling’s sharp depreciation in the immediate aftermath of the referendum has pushed up shop prices at a time when wage growth is largely stagnant. Nielsen said Britain declined from second in Europe’s consumer confidence rankings just before the Brexit vote to ninth now.

Separate figures show that British retail sales growth slowed broadly as expected in July after a strong second quarter, as shoppers cut back on purchases of most goods other than food, adding to worries about a fall in consumer demand caused by higher inflation.

Year-on-year retail sales growth dropped to 1.3% in volume terms, down from 2.8% in June, the UK’s Office for National Statistics said.

In the three months to July, annual sales growth was the weakest since November 2013 at 1.8%.

Additional reporting: Reuters

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