Consumers' desire to save or invest their money has fallen sharply, according to a survey by Bank of Ireland.

Its latest Savings and Investment Index recorded its biggest ever quarterly decline in the final three months of the year, and now stands at its lowest ever level.

Consumers' saving intentions tends to drop in the run up to Christmas, but this year's was particularly pronounced.

Only a third of respondents to the survey said now was a good time to save, compared to almost half a year ago.

Meanwhile 40% said it was a bad or very bad time to save, up from 24% in the three months to the end of September.

The survey also found that fewer respondents had invested in recent months, while consumers' percention of the investment environment had declined.

More than 40% now see it as a bad or very bad time to invest, compared to 29% three months earlier.

"It seems likely that there is pent up demand to spend rather than save and all else being equal this could translate into a surge in spending in the run up to and during the Christmas period," said Kevin Quinn, chief investment strategist at Bank of Ireland. "This shift also reflects an increased awareness among consumers that the meagre returns on savings and rising prices have eroded the value of savings in this environment.

What's also striking is the drop in confidence about investing, despite some exceptionally strong returns for investors this year. Perhaps this reflects the winds of change as the world economy reacts to Omicron, inflation and central bank policy changes – all of which are part of the journey towards a post pandemic economy."

When asked about their main concerns, almost three quarters of respondents pointed to a new wave of Covid-19, up 12% on the September reading.

Meanwhile 64% pointed to concerns about family health, up 7% in the three months.

However there was some relative optimism in the survey too, with more respondents confident they would be comfortable in retirement.

Meanwhile financial preparedness for retirement had improved slightly.