Issue 299 (Week ending 07/08/2016)

Today's research suggests that consumer confidence is slowly returning to the Irish economy following a period of financial restraint. 3 out of 4 Irish consumers are planning a major purchase by the end of 2017 - 36% of these planned to do so before the end of 2016. Holidays, Used Cars and Home improvement projects were the most common planned purchases which will be good news for companies operating in those sectors.

As a country, we appear to be more cautious in our borrowing habits. Only 15% of respondents were willing to take on debt to fund the purchase. 35% of respondents will use a combination of loans and savings and there are differences in the borrowing habits of men and woman.

This suggests that consumers are still very cautious about their long term financial prospects. Reasons for this may include more restrained earning potential, existing debt and tax burdens and perhaps a long lasting sense of financial conservatism following the crash.

In terms of our saving habits - we found that 67% of those surveyed had savings on deposit. We found a higher number of men than woman had savings (75% vs 60%). This gender difference carried through to the level of savings where on average men tended to have E10k more savings than woman. (E21,654 v E11,704). This is likely to be explained in part by the gender pay gap and also the fact that more women than men work part-time often to attempt to balance childcare responsibilities.

While confidence is returning there is a cautious approach to finance. Wider factors such as personal debit, tax burdens and Brexit are likely to be factors. Given how recent the referendum was it is difficult to discern the impact of Brexit on future consumer spending.

This will likely be more discernible in our next quarterly index which will be published in mid-Autumn. At this stage however, it does appear that the results of the referendum are having little effect on spending, for example CSO figures state that new car sales for July 2016 sales post Brexit were up 5.5% on July 2015.