Another no-show by the confidence fairy… November 8, 2012Posted by WorldbyStorm in Economy, Irish Politics.
Yet another report on consumer confidence in the SBP, by Pat Leahy. And the news is – as is all too predictable – not entirely great.
Consumer confidence has taken another battering in recent months, according to the latest Red C tracking survey, with expectations of a tough budget pushing confidence to its lowest level in a year.
Indeed the figures are telling:
People also feel more of a “personal impact” from the recession in the last three months according to the survey, the first since June.
Some 40 per cent of consumers say that the recession has had a “high impact” on them in the past three months. Those aged 45-64 and those with children are more likely to have felt a severe impact from the recession.
That too is not a surprise. And it has clear problematic aspects for the next month or so:
The decline in confidence is reflected across a range of indicators. Some 39 per cent report a high impact on their “way of life”; 45 per cent report a similar impact on their monthly spending. These numbers are up by 9 per cent and 8 per cent respectively from June, suggesting further weakness in domestic demand in the run-up to the Christmas season.
But all is not lost. The confidence fairy may not have showered us with optimism dust, but even so, Leahy reports some ‘hints of optimism’. I don’t know though. Reading the data it seems to me to be something of a fools paradise for those who think that way.
Almost half of people feel that the Irish economy will fare the same or better in the next six months – the highest level of optimism about the future recorded in more than a year.
Let’s consider the logic of this. Another recessionary ‘austerity’ budget, about to pull yet more monies from expenditures (indeed the same edition of the SBP suggested that Michael Noonan would have to find an extra third of a billion ‘savings’ on top of those already pencilled in) is about to be introduced. How, in the name of God, is it feasible that this will ameliorate the situation? Though the following stat is revealing:
Those older than 65 are the most optimistic; other surveys show that they have experienced the recession less severely than other groups.Almost 60 per cent believe the world economy will improve or stay the same in the next six months.
It will be interesting to revisit those figures in light of some of the changes suggested for pensioners (indeed, also in the SBP is news that means testing for travel will be introduced for pensioners, and perhaps other measures).
And not only, but also:
Expectations of the housing market have also improved since June. Nearly a quarter of consumers (23 per cent) expect the market to improve in the next six months, an improvement of some 6 per cent since June.The survey was conducted among more than 1,000 adults in mid-October.
Which is wonderful, except the figures are still abysmal.
I’m interested to know whether people feel they’ve felt particular impacts in the last three months from the recession over and above the previous three? And what of confidence?