Consumer sentiment increases slightly

Consumer confidence grew slightly in November and, consequently, succeeded in stemming five successive months of declining sentiment, according to a survey published yesterday.

The Consumer Sentiment Index, compiled by IIB Bank in conjunction with the Economic and Social Research Institute, recorded a level of 66.5 in November, up from 65.9 in October.

The corresponding figure for November last year was 79.4.

Mr Austin Hughes, chief economist with IIB Bank, described confidence as "fragile" but said the November data were encouraging.

"They hint that the decline in consumer confidence could be coming towards an end," said Mr Hughes.

He added that the level recorded in November was consistent with "modest increases in consumer spending over the Christmas period".

"Because sentiment and spending have been on a moderating trend for some time, consumers still have the wherewithal to allow at least a little indulgence over the festive season," Mr Hughes said.

He also believes the growing likelihood of a euro-zone rate cut being delivered next month may have increased consumers' optimism.

The research suggests that, while consumers are feeling more confident about current economic conditions, they are, however, less certain about their future financial situation.

A sub-index measuring consumers' expectations declined from 53.7 in October to 52.3 in November.

Three out of four consumers are shown to expect unemployment levels to grow over the coming year.