Consumer Confidence Rising, Says Bank

A new NI-based survey has revealed a significant reduction in the number of people who are pessimistic about their anticipated financial position over the coming year.

Local consumer confidence rose to its highest level in 10 months in June suggesting that economic stability is helping to shed some of the recessionary gloom.

A Northern Bank economist, Angela McGowan (pictured), said there had been a 26% fall from the peak of the financial crisis in September 2008 in the number of respondents who expected their financial position to worsen.

The survey results revealed the number of people gloomy over how they expect their finances to change over the coming year fell by over a quarter (from 49% at the peak of the financial crisis) to just 23% in the latest June survey.

The latest findings are from the report 'Consumer Confidence Index for Northern Ireland', just published by the Northern Bank.

They show that consumer confidence, although fragile, continues to climb in the right direction.

Ms McGowan said: "It's clear that expectations for sustained low interest rates into next year and that inflation will continue to fall in the coming months are having an impact upon consumer sentiment - particularly with regard to their expectations for personal finances in the next year."

Expectations surrounding job security also improved marginally in June compared to the previous quarter.

Ms McGowan concluded: "While spending expectations have marginally improved, there has most definitely been a shift in how and where consumers spend their money.

"Without doubt falling prices have helped consumers to maintain a certain level of expenditure in recent months, although they remain cautious.

"The biggest threat to consumer spending is probably a rise in oil prices," she continued.

"In early July we got a small warning that oil price volatility remains a lurking threat, which will drive up the cost of living and put pressure on spending on non-essential items."

For June 2009, the study took place from 6th June to 13th June with 1,000 people and was carried out by Millward Brown.

(BMcC/JM)