Sunny July boosts sentiment
Consumer sentiment recovered in July to its highest level since March as summer sales and holidays boosted spending plans, according to the latest index from KBC Bank Ireland and the Economic and Social Research Institute.
Fine weather may also have exerted a “modest” positive influence on the mood of consumers, said KBC Bank Ireland chief economist Austin Hughes.
“Our calculations imply that, in most circumstances, weather isn’t a key driver of the economic mood of Irish consumers,” Mr Hughes said. “However, exceptionally favourable weather conditions like those experienced in Ireland of late may well have caused more consumers to see their economic glass as half full rather than half empty.”
The bad news is that this effect is likely to be only temporary. The likelihood is that a return to more normal weather conditions will prompt a “somewhat cooler” assessment of the economic climate .
The index rose to a reading of 107.6 in July from 102.1 in June, which represented the strongest monthly increase since January and the highest level since March.
There was a sharp increase in purchasing plans, reflecting the summer sales, the new 18-2 car registration plate and holiday spending. The second-largest improvement in the survey was in consumers’ assessments of how their household finances had evolved.