Irish consumer sentiment slumps further as Brexit rumbles on


FILE PHOTO: Commuters make their way into work in the morning in the financial district of Dublin, Ireland October 18, 2018. REUTERS/Clodagh Kilcoyne

DUBLIN (Reuters) – Irish consumer sentiment fell for a fourth successive month for the first time since late 2012 as uncertainty over neighbouring Britain’s departure from the European Union continued to weigh on confidence, a survey showed on Tuesday.

While Ireland’s economy has remained the fastest growing in the EU throughout three tortuous years of Brexit negotiations, consumer confidence took a hit in recent months as the prospects of a no-deal British exit rose.

The most recent survey ran from Oct. 10 to 18, a period that began with a meeting between the leaders of Ireland and Britain that paved the way for a deal that failed to progress through the British parliament before an election was called.

The KBC Bank consumer sentiment index sank to 69.5 last month from 75.3 in September, the lowest level in over six years. The index stood at 93.5 a year ago.

“There is little doubt that the ongoing decline in consumer confidence  is largely as a result of continuing nervousness around Brexit,” KBC Bank Ireland chief economist Austin Hughes said.

“Whereas risks are large and one-sided from a consumer confidence perspective, this has to be weighed against the current reality of healthy gains in employment and improving incomes. So, spending hasn’t stopped but it is notably slower than it might otherwise be.”

Hughes added that the October reading may also hint at a measure of disappointment with Ireland’s budget for 2020 when the government eschewed the tax cuts and spending increases of recent years to set aside funds for firms most exposed to Brexit.

Reporting by Padraic Halpin; Editing by Angus MacSwan

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