A new survey shows that with the country more or less in full lockdown, job losses soaring and incomes under pressure, consumer and business confidence both sank in April.
The Bank of Ireland Economic Pulse came in at 34.3 in April, the lowest reading in its history.
The index, which combines the results of the Consumer and Business Pulses, was down 36.1 on last month and 57 lower than a year ago.
It reveals that three in five firms expect a further decline in business activity in the coming three months and just over a quarter anticipate having to lay off staff.
Three in five households also indicated that they are holding out on spending because they are not certain which way economic policy is going to go.
Expectations for house price increases took a battering this month, with buying and especially selling sentiment also softening, Bank of Ireland said today.
Dr Loretta O'Sullivan, Group Chief Economist for Bank of Ireland, said this month's survey findings are "grim" in the extreme.
She said that the Economic Pulse reading is down a whopping 36 points, more than double last month's drop.
"With the country more or less in full lockdown, job losses soaring and incomes under pressure, consumer and business confidence both tanked in April," Dr O'Sullivan said.
"The Covid-19 shock is unprecedented and has resulted in a sudden turnaround in the economy's fortunes.
"Given this and the huge uncertainty about the path of the virus and the depth and duration of the recession, it is no wonder that households and firms are very uneasy," she added.
Bank of Ireland said today that its Business Pulse posted a historic low in April 2020, coming in at 29.6. This was down 38.8 on March and 63.7 lower than a year ago.
The readings were weak across the board, with seven in ten firms reporting lower business activity in the recent trading period - led by services and retail.
Bank of Ireland said the Covid-19 outbreak and the policy actions being taken at home and overseas to suppress the virus are affecting businesses through a number of channels - demand, supply chains, operations - and mostly negatively, though around three in ten are seeing some new opportunities.
The survey also showed that firms are downbeat about business activity and hiring, while one in five expects to cut wages in the coming year.
Today's survey shows that the Consumer Pulse stood at 53.2 in April 2020, down 25.3 on last month and 30.3 on a year ago.
Households' assessment of the economy and their own financial prospects moved deep into the red this month, taking the headline index to an all-time low.
Bank of Ireland noted that with the pandemic very much to the fore, just 13% considered it a good time to purchase big ticket items like furniture and electrical goods, down from 31% last month.
Meanwhile, the Housing Pulse came in at 25 in April, a fall from last month's reading of 52.4 and a new low for the series.
Bank of Ireland said that expectations for house price gains over the coming year fell sharply this month, and for the first time since sentiment started to be tracked in January 2016, more households now expect prices to decline (55%) than go up (one in seven).
"The Covid-19 outbreak has imparted a significant shock to the economy and with the government imposing a temporary rent freeze and ban on evictions, households' expectations for future rent increases also headed into negative territory," Bank of Ireland said.
Today's survey shows that 25% of consumers think it is a good time to sell a house, a big slump from the 61% at the start of the year.