Irish consumer sentiment stabilised in May, according to the latest IIB/ESRI consumer sentiment index. The index rose marginally to 97.4 during May compared to a figure of 97.3 in April.
The corresponding figure for May 2004 was 91.1. The three month moving average declined to 99.6 from the 100.3 recorded in April. The three month moving average had stood at 98.6 the same time last year.
Austin Hughes, IIB Bank, said the May sentiment data suggests that Irish consumers are currently in a 'wait and see mode'. He said that conflicting signals on the economy seem to be restraining confidence and may limit spending growth in the coming months.
'A number of high profile job loss announcements early in the month undoubtedly weighed on sentiment,' the economist said. 'The May data reveal that consumers were more pessimistic about the outlook for jobs than at any time in the past year,' he added.
Mr Hughes added that the broadly stable Irish consumer sentiment reading is notably better than similar indicators for other countries which weakened further in May.
'This underlines the fact that the Irish economic situation is better than elsewhere but is not immune to concerns about the health of the global economy,' he added.
The Consumer Sentiment index comprises two sub-indices - an index of consumer expectation that focuses on how consumers view prospects over the next 12 months and an index of current economic conditions, focusing on the present situation.
The Index of Consumers Expectations weakened to 98.2 in May, compared with 91.9 in April, but consumers perception of their current situation improved in May. This index rose to 109.6 in May from 105.2 in April.
'Although consumers have become more positive in their perceptions of the current economic environment, this has been offset by concerns about the future,' commented the ESRI's David Duffy.
'The decline in the forward-looking index is due to a much more negative perception by consumers of the outlook for the labour market. Nearly 50% of consumers expect the unemployment rate to rise over the next 12 months,' he added.
