The Consumer Sentiment Index (Chart 1) remains
level at 96.5 points between November and
December. While consumers experienced a
significant improvement in current conditions, this
was offset by a loss of confidence in terms of future
expectations. This continued decline in consumer
expectations is likely a symptom of increased
uncertainty with respect to ongoing Brexit
negotiations as the likelihood of a No-Deal scenario
rises

Author, No

The Consumer Sentiment Index (Chart 1) remains

level at 96.5 points between November and

December. While consumers experienced a

significant improvement in current conditions, this

was offset by a loss of confidence in terms of future

expectations. This continued decline in consumer

expectations is likely a symptom of increased

uncertainty with respect to ongoing Brexit

negotiations as the likelihood of a No-Deal scenario

rises

Archive of European Integration

                                     CONSUMER SENTIMENT INDEX, DECEMBER 2018     The Consumer Sentiment Index (Chart 1) remains level at 96.5 points between November and December. While consumers experienced a significant improvement in current conditions, this was offset by a loss of confidence in terms of future expectations. This continued decline in consumer expectations is likely a symptom of increased uncertainty with respect to ongoing Brexit negotiations as the likelihood of a No-Deal scenario rises.    Current Economic Situation  The Index of Current Economic Conditions tracks developments in consumers’ personal financial situations over the past 12 month as well as their views on whether the present represents a good time to make major purchases. The Index (Chart 2) increased by 4.6 index points between November and December, rising to 119.2. On an annual basis, the Index of Current Economic Conditions remains subdued, 3.7 index points below December 2017. Similarly, while major purchases have improved relative to last month, December 2018 marks the fourth consecutive month of year-on-year declines.  The Index of Consumer Expectations tracks consumers’ outlook with respect to future economic developments over the next year, taking into account expectations of their future personal finances as well as broader economic performance. Compared to November, the Index (Chart 3) fell by 3 index points to 81.2. Concerns about the domestic economy weigh strongly on the index. As of December 2018, the general economic outlook has fallen below the 50 point index region (-6 points), suggesting the majority of individuals expect weaker economic performance over the next 12 months. The outlook for unemployment has also worsened, as concerns about global risk factors intensify in December.                                KBC Bank Ireland, Sandwith Street, Dublin 2, Tel: 01-664 6889, Fax: 01-664 6898, Web: www.kbc.ie  ESRI, Whitaker Square, Sir John Rogerson's Quay, Dublin 2, Tel: 01-863 2000, Web: www.esri.ie     Personal Financial Situation  Households have remained confident about their respective financial situations over the last 12 months, as reflected by a 9.0 index point rise between November and December. However, slightly less confidence has been exhibited relative to the same period last year. Assessments regarding expected personal finances suggest respondents anticipate a far more gradual improvement over the next 12 months as reflected by the 1.7 index point rise.  Though consumers have exhibited a strong downturn in sentiment in the final quarter of 2018, this appears to be mostly a result heightened uncertainty rather than due to a deterioration in macroeconomic conditions or living standards.                                                           Table 1: Survey Index Results  Measure1 Long-Run average2 Δ month-on-month Dec. Nov. Dec. 2017 2018 2018  Overall Consumer Sentiment Index 98.3 ↑0.1 103.2 96.5 96.5  Index of Current Conditions 113.2 ↑4.6 122.9 114.6 119.2  Index of Consumer Expectations 88.4 ↓3.0 90.0 84.3 81.2               Personal Financial Situation over last 12 months 91.2 ↑9.0 106.2 96.2 105.2  Personal Financial Situation over next 12 months 110.2 ↑1.7 115.9 117.6 119.3  General Economic Outlook 68.2 ↓6.0 65.3 54.5 48.5  Outlook for Unemployment 91.3 ↓4.7 94.8 86.8 82.1  Major Purchases 131.3 ↑1.0 136.8 129.7 130.8  (1) Index values: Quarter 4, 1995 = 100.      (2) Average value between December 2013 and December 2018     KBC Bank Ireland, Sandwith Street, Dublin 2, Tel: 01-664 6889, Fax: 01-664 6898, Web: www.kbc.ie  ESRI, Whitaker Square, Sir John Rogerson's Quay, Dublin 2, Tel: 01-863 2000, Web: www.esri.ie   Disclaimer This report has been reviewed prior to publication. The authors are solely responsible for the content and the views expressed.  Notes The Index of Consumer Expectations is based on consumers’ perceptions of their future financial situation, their economic outlook  for the country as a whole and employment expectations. The Index of Current Economic Conditions is based on how consumers feel about their current financial circumstance compared with 12 months ago, as well as their perception of the current buying environment for large household purchases.   The data are obtained from telephone interviews during the first two weeks of the month with around 800 completed questionnaires. The data are re-weighted in line with gender, age and level of educational attainment to ensure the data were fully representative of the national population of adults. Each index is calculated by computing the relative scores (the percent giving favourable replies minus the percent giving unfavourable replies (the balance), plus 100) for each question used in the different indices. Those who reply “Don’t Know”, “Remain the same” are excluded from the index calculations. Each relative score is rounded to the nearest whole number. The sum of the relative scores is then divided by the base period total for each index. More details on www.esri.ie.                                                         For further information contact   Austin Hughes – Chief Economist, KBC Bank Ireland– (01) 664 6889 or Philip Economides – Research Assistant, ESRI – (01) 863 2045 Conor O’Toole – Senior Research Officer, ESRI – (01) 863 2046  Historic data from April 1996 are available on the ESRI website, www.esri.ie and on the KBC Bank Ireland website, www.kbc.ie. The most recent releases are also available on the website.KBC Bank Ireland, Sandwith Street, Dublin 2, Tel: 01-664 6889, Fax: 01-664 6898, Web: www.kbc.ie  ESRI, Whitaker Square, Sir John Rogerson's Quay, Dublin 2, Tel: 01-863 2000, Web: www.esri.ie    

Consumer Sentiment Index, December 2018

Consumer sentiment ended the year relatively

unchanged, with the Index falling back slightly by 0.4

index points to 103.6 for December 2017 (Chart 1).

Similarly to November, the minor monthly decline in

December is driven by a fall in the Index of

Consumer Expectations. More broadly, looking back

across 2017, the Index has risen by 7.0 points

indicating a continued strengthening of consumer

activities in line with the improvements in the

domestic economy

            CONSUMER SENTIMENT INDEX, DECEMBER 2017     Consumer sentiment ended the year relatively unchanged, with the Index falling back slightly by 0.4 index points to 103.6 for December 2017 (Chart 1). Similarly to November, the minor monthly decline in December is driven by a fall in the Index of Consumer Expectations. More broadly, looking back across 2017, the Index has risen by 7.0 points indicating a continued strengthening of consumer activities in line with the improvements in the domestic economy.   Current Economic Situation  The Index of Current Economic Conditions tracks developments in consumer’s personal financial situation over the past 12 month as well as their views on whether the present represents a good time to make major purchases. The Index (Chart 2) increased by 1.2 index points to 122.9 in December 2017. The rise was driven by an increasingly positive perception of current financial circumstances relative to 12 months ago (+1.5 index points) along with greater confidence regarding the purchase of major household items (+1.0 index points). These household purchases are 9.1 index points higher than December 2016, indicating a strengthening household perception towards the buying climate and their own financial circumstances.  The Index of Consumer Expectations (Chart 3) tracks consumers’ outlook on future economic developments over the next year, more specifically regarding their personal finances and the broader economy. The Index declined by -1.5 index points to 90.0 in December 2017. The monthly decrease was due to weakened perceptions surrounding future personal financial situations, whereas economic and employment expectations remained flat, increasing by 0.5 and 0.0 index point respectively. Despite their broad optimism surrounding the wider economy, households appear to be more pessimistic about the outlook for their own finances going into 2018.                               KBC Bank Ireland, Sandwith Street, Dublin 2, Tel: 01-664 6889, Fax: 01-664 6898, Web: www.kbc.ie  ESRI, Whitaker Square, Sir John Rogerson's Quay, Dublin 2, Tel: 01-863 2000, Web: www.esri.ie   Personal Financial Situation  In December 2017, consumers’ perceptions of their current and future financial situations diverged.  While many feel their situation has improved in the last year (+1.5 index points), there has been a fall back in terms of their future expectations on their financial circumstances (-4.8 index points). This most recent divergence is consistent with recent Index reports which have shown households more cautious on their own circumstances and more bullish with regard to the broader economic recovery. The ongoing international uncertainties could potentially play a role in explaining the moderation in households forward looking view on their personal circumstances.    Overall, when compared with the respective figures over the past 12 months, a continued trend of moderate improvements in personal financial outlooks both with respect to current circumstances (+9.7 index points) and future expectations (+3.9 index points) is observed.                                                         Table 1: Survey Index Results  Measure1 Long-Run average2 Δ month-on-month Dec. Nov. Dec. 2016 2017 2017  Overall Consumer Sentiment Index 91.0 ↓0.4 96.2 103.6 103.2  Index of Current Conditions 105.0 ↑1.2 113.6 121.7 122.9  Index of Consumer Expectations 81.5 ↓1.5 84.5 91.5 90.0               Personal Financial Situation over last 12 months 79.5 ↑1.5 96.5 104.6 106.2  Personal Financial Situation over next 12 months 98.8 ↓4.8 112.0 120.7 115.9  General Economic Outlook 64.6 ↑0.5 60.1 64.8 65.3  Outlook for Unemployment 85.4 0.0 86.4 94.8 94.8  Major Purchases 126.0 ↑1.0 127.6 135.7 136.8  (1) Index values: Quarter 4, 1995 = 100.      (2) Average value between December 2012 and December 2017     KBC Bank Ireland, Sandwith Street, Dublin 2, Tel: 01-664 6889, Fax: 01-664 6898, Web: www.kbc.ie  ESRI, Whitaker Square, Sir John Rogerson's Quay, Dublin 2, Tel: 01-863 2000, Web: www.esri.ie       Disclaimer This report has been reviewed prior to publication. The authors are solely responsible for the content and the views expressed.  Notes The Index of Consumer Expectations is based on consumers’ perceptions of their future financial situation, their economic outlook for the country as a whole and employment expectations. The Index of Current Economic Conditions is based on how consumers feel about their current financial circumstance compared with 12 months ago, as well as their perception of the current buying environment for large household purchases.   The data are obtained from telephone interviews during the first two weeks of the month with around 800 completed questionnaires. The data are re-weighted in line with gender, age and level of educational attainment to ensure the data were fully representative of the national population of adults. Each index is calculated by computing the relative scores (the percent giving favourable replies minus the percent giving unfavourable replies (the balance), plus 100) for each question used in the different indices. Those who reply “Don’t Know”, “Remain the same” are excluded from the index calculations. Each relative score is rounded to the nearest whole number. The sum of the relative scores is then divided by the base period total for each index. More details on www.esri.ie.                                                         For further information contact   Austin Hughes – Chief Economist, KBC Bank Ireland– (01) 664 6889 or Philip Economides – Research Assistant, ESRI – (01) 863 2045 Conor O’Toole – Senior Research Officer, ESRI – (01) 863 2046  Historic data from April 1996 are available on the ESRI website, www.esri.ie and on the KBC Bank Ireland website, www.kbc.ie. A detailed methodology note outlining how the indices are constructed and the most recent release are also available on the websites.KBC Bank Ireland, Sandwith Street, Dublin 2, Tel: 01-664 6889, Fax: 01-664 6898, Web: www.kbc.ie  ESRI, Whitaker Square, Sir John Rogerson's Quay, Dublin 2, Tel: 01-863 2000, Web: www.esri.ie      

Consumer Sentiment Index, December 2017

http://aei.pitt.edu/101749/1/CSI2017DEC.pdf

Consumer Sentiment Index, December 2018

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