'No major change' in consumer sentiment despite new Budget measures and easing living costs

Survey found that ongoing squeezes in personal finance and longstanding shortfalls in health and housing remain at the forefront of consumers' minds

Loading platform made of scaffold system on housing development construction site

Consumer sentiment improved modestly in October as reduced nervousness about job loss and a slight easing in cost of living pressures combined with new Budget measures to boost confidence.

The Credit Union Consumer Sentiment Index recorded a reading of 74.1 in October, up slightly from the 71.9 reported in September.

Despite reporting a small recovery, the survey said it did not suggest any major change in Irish consumer thinking, nothing that an uncertain world, ongoing squeezes in personal finance and longstanding shortfalls in health and housing remain at the forefront of consumers' minds.

"There is little sense that Irish consumers think Budget 2025 will dramatically improve the outlook for their household finances but there was a marginal improvement in expectations for the next twelve months and a moderate increase in spending plans," the index said.

After a loss of positive momentum in the survey readings for August and September, the October reading at least tentatively points to a less worried Irish consumer, said economist Austin Hughes. 

However, Mr Hughes noted that with the current level of the sentiment index still some distance below the long-term survey average of 84.3, Irish consumers remain guarded in their thinking about their own financial circumstances and the broader economic backdrop.

Budget 2025

The index also found that only a small number of consumers expect Budget 2025 to being about a significant improvement in their living standards. 

A further 42% expect the Budget will lead to a slight improvement in their living standards while 47% don’t think Budget measures will lead to an improvement in their living standards.

"In broad terms, these results suggest that roughly half of Irish consumers expect some boost from Budget ’25 to their living standards while the remainder don’t expect an improvement," said Mr Hughes.

Austin Hughes. Credit:- Iain White Photography

The survey also found that consumers rated the Budget most negatively in regard to housing and health measures, the two areas that had been singled out in the September sentiment survey as by far of most importance to consumers in terms of priorities for them for the Budget.

"The share of negative responses in housing and health is markedly greater than for any other heading," said Mr Hughes. "While the large and lasting nature of these problems means that a major policy initiative was unlikely to come in Budget ’25 for a range of reasons, the survey results emphasise the extent to which Irish consumers see housing and health as the critical issues facing the country today."

In contrast, the increase in social welfare rates was seen by consumers as the most positive element of the Budget.