Irish consumer sentiment fell to it lowest level in four years last month as a slowdown in the once booming housing sector led to jitters over jobs, a survey showed today.
The IIB Bank/ESRI Consumer Sentiment index fell to 71.8 in October from 74.3 in September, its lowest since October 2003. The index was at 86.7 in October last year.
IIB chief economist Austin Hughes
"There is little doubt that worries about the Irish housing market were the main driver of poorer sentiment last month," IIB chief economist Austin Hughes said.
"Even though new job announcements substantially outnumbered layoffs in the survey period, consumers are worried that a weaker housing market will spill over into more broadly based problems in the jobs market."
The component measuring perceptions of current economic conditions dropped to 91.8 in October from 93.6 in September due to a feeling among consumers that their current financial situation was weakening and a reluctance to buy major household items.
The forward-looking sub-index gauging people's expectations also slipped, falling to 58.4 in October from 61.2 in September, weighed down by negative views on the outlook for jobs and the broader economy as a whole.
Hughes said consumers were slightly more positive about their own household finances due to expectations the European Central Bank would not raise interest rates given turmoil in global credit markets.
"A break from regular rate increases and even tentative hopes of still distant rate cuts appear to be a very important silver lining in an increasingly dark and cloudy economic sky," he said.