Consumer confidence is back on an upward trajectory according to a new report from the Marketing Institute and University College Dublin's Smurfit Business School. Its Consumer Market Monitor says for the first time since the 2008 recession more people expect their household finances to improve this year than expect their finances to disimprove. The monitor brings together various data from, among other sources, the Central Statistics Office, the European Commission and the European statistics agency Eurostat.
Mary Lambkin, Professor of Marketing at the Smurfit School, says that lots of different groups monitor their own subject, such as car sales and house sales. But there is not many places where you can find these things all brought together and Professor Lambkin says a more interesting story can be told by bringing everything together. This monitor also tracks the data over a long period of time so one gets to see the long term trends, which can reveal a lot more than monthly data, she adds. "We feel we are adding value by just pulling the thing together and looking for consistent trends," the Professor states.
Professor Lambkin says the amount of money in the economy - the amount of disposable income - rose slightly last year after being flat and quite depressed for a number of years. She said the increase was a direct reflection of the growth in employment. More consumers are also expecting their finances to improve over the coming year than expecting them to disimprove.
The Professor says consumer confidence is measured by an index which adds together the answers of six different questions. One of these questions is how people feel about their own personal circumstances and whether they think they will make spending decisions. If people are not feeling optimistic, they will mind whatever money they have rather than putting it out into the economy. But the increased levels of optimism out there at the moment is a huge indicator than people are willing to spend. Ms Lambkin says the evidence of this is already out there. While there was a little bit of a lag between improved consumer sentiment and actual buying, she says there is definitely increased levels of spending in the economy now.
MORNING BRIEFS - The Irish manufacturing sector has shown growth in every month for two straight years, according to the latest purchasing managers index from Investec. The index, which gives an indication of activity levels and sentiment in manufacturing each month, shows strong growth in May. It points to the weakness of the euro against sterling and the dollar as a significant factor behind rising export orders.
*** Swiss-Irish baked goods group Aryzta says revenue over the three months to the end of April was up 13% on the same period in 2014. In a trading statement, though, chief executive Owen Killian explained the company is working through issues in a number of markets. In North America it is in the midst of a restructuring programme. Its underlying revenue there, stripping out the impact of acquisitions, is down by almost 7%. In France, Aryzta says, sales have been hit by what it called security concerns among consumers following the Charlie Hebdo shootings and supermarket siege in January. For the full year, Aryzta said the outlook for its food business is for zero growth in earnings year-on-year.
*** The leaders of the group of seven of the world's wealthiest nations prepare to meet their African counterparts as part of the annual G7 summit in Germany this week. Ahead of that Oxfam has produced a report outlining what it estimates is a $6 billion annual loss to African states due to what it calls tax dodging by companies and investors based in G7 nations. Oxfam calculates that in 2010 - the most recent year for which figures are available - companies avoided paying tax on $20 billion of income resulting in $6 billion in lost tax revenue in Africa through a practice called trade mispricing. Trade mispricing occurs where the prices of goods and services transferred between subsidiaries of a multinational organisation across borders are set artificially in order to minimise tax liabilities.