Irish consumer confidence dives again as inflation fears spread

div classBodysc17zpet90 cdBBJodivpDUBLIN Reuters – Irish consumer confidence suffered its second successive sharp monthly drop as concerns about living costs that hurt the macro economic outlook in March spread into a weakening of spending plans in April, a survey showed on Thursday.p

pThe KBC Bank Ireland consumer sentiment index dropped to 57.7 from 67.0, an almost identical fall to that from February to March, which was the sharpest since the start of the COVID19 pandemic when swathes of the economy shutdown.pdivdivdiv classBodysc17zpet90 cdBBJodiv

pThe index stands significantly below the longterm average of 86.6 and the cumulative 24 point decline since Irish inflation began climbing sharply over the last three months was the second largest in the 26year history of the survey.p

pIt was scarcely surprising that there was a downgrade of the current and future state of household finances, the surveys authors said, citing upward pressure on energy costs and increased concerns in relation to food prices.p

p“A more threatening development was a marked pullback in consumer spending plans. The April 22 purchasing climate is the weakest since the COVIDclosedown related results for April and May 2020 and among the lowest on record for this component,” KBC Ireland chief economist Austin Hughes said.p

p“Significantly, this may hint at a marked pullback in consumer spending that is both forced and feardriven.” p

pIt also suggests the broader Irish economic outlook for the coming months may feel a good deal cooler than might be inferred by most economic growth forecasts – including KBCs – Hughes added.p

pIrelands finance ministry said last week that it expected the impact of the war in Ukraine and rising inflation to slow rather than stop economic expansion this year, cutting its growth forecast for the domestic economy to 4.2.p

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pp Reporting by Padraic Halpin editing by Barbara Lewisp

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