Irish consumer confidence falls to 13-month low in June

Irish consumer sentiment weakened in June to its lowest level in 13 months as those questioned voiced concern about growing risks to the global economy and the impact of higher housing and fuel costs, a survey showed on Thursday.

Ireland’s economy has posted the fastest growth in Europe since 2014 and unemployment has fallen rapidly, but the recovery has been uneven for some consumers, with only modest gains in purchasing power.

The KBC Bank Ireland/ESRI Consumer Sentiment Index slipped to 102.1 in June from 106.7 in May, continuing a see-saw pattern of monthly changes since the index hit a 17-year high in January.

The survey’s authors said in a statement that the fall - the second largest in the past 20 months - emphasised the fragility of the financial situation and of Irish consumers a decade after the 2008 crash.

The fall appeared in part to be caused by concerns about Britain’s exit from the European Union and the growing threat of an international trade war, the survey’s authors said.

“The significant drop in Irish consumer sentiment in June seems to reflect a notably more threatening global economic outlook,” KBC Ireland Chief Economist Austin Hughes said. “In addition, continuing pressures on household finances mean Irish consumers are more susceptible to bad news.”

Only one in four consumers believed their household financial situation had improved in the past 12 months, the survey found. A similar proportion expected gains in the coming year.

The survey indicated, however, that overall Irish consumers remain “modestly positive” about their prospects, Hughes said.