Un­cer­tainty hurts North’s econ­omy

The Irish Times - - Business News - FRANCESS McDON­NELL

Po­lit­i­cal un­cer­tainty and the ab­sence of a North­ern Ire­land Ex­ec­u­tive has sent con­sumer con­fi­dence lev­els plum­met­ing again in the North, ac­cord­ing to new re­search.

The lat­est Danske Bank North­ern Ire­land Con­sumer Con­fi­dence In­dex shows peo­ple were less happy about their fi­nan­cial sit­u­a­tion in the last quar­ter than they were 12 months ear­lier.

The in­dex also il­lus­trates that peo­ple may be less in­clined to spend on “high value” items such as fur­ni­ture or hol­i­days in the com­ing year com­pared with their re­cent spend­ing pat­terns and that the ma­jor­ity of house­holds do not ex­pect their fi­nan­cial po­si­tion to im­prove over the next year.

As a re­sult many ex­pect they would be un­able to save as much as they did pre­vi­ously.

Conor Lambe, Danske Bank econ­o­mist said the sur­vey shows that although many con­sumers said they were feel­ing the im­pact of per­sis­tent high in­fla­tion this year, the big­gest neg­a­tive im­pact was di­rectly linked to the on­go­ing po­lit­i­cal un­cer­tainty in the North.

Mr Lambe added: “Un­sur­pris­ingly, some con­sumers said that Brexit was hav­ing a neg­a­tive im­pact on their con­fi­dence lev­els, while oth­ers said it was af­fect­ing them pos­i­tively.

“Of the fac­tors hav­ing a pos­i­tive im­pact on con­fi­dence lev­els, 22 per cent of peo­ple men­tioned low in­ter­est rates. Many peo­ple, par­tic­u­larly those with vari­able rate bor­row­ings, will be watch­ing fu­ture mon­e­tary pol­icy an­nounce­ments closely as the Bank of Eng­land’s Mon­e­tary Pol­icy Com­mit­tee looks set to raise in­ter­est rates rel­a­tively soon.”

De­te­ri­o­rated

Ac­cord­ing to Danske Bank a sig­nif­i­cant percentage of res­i­dents of North­ern Ire­land – par­tic­u­larly part-time work­ers, home­mak­ers, re­tired peo­ple and un­em­ployed peo­ple – be­lieve their fi­nan­cial po­si­tion has de­te­ri­o­rated over the past year.

In con­trast, how­ever, peo­ple with full-time jobs or stu­dents be­lieve they are bet­ter off than they were a year ago. Ac­cord­ing to Danske Bank the over-65s are among the least op­ti­mistic, but North­ern Ire­land’s younger pop­u­la­tion ap­pears to be the most con­fi­dent about their fu­ture fi­nances: 27 per cent of 16- to 24-year-olds and 26 per cent of 25- to 34-year-olds ex­pect their fi­nances to im­prove .

Newspapers in English

Newspapers from Ireland

© PressReader. All rights reserved.