The Danske Bank Northern Ireland Consumer Confidence Index decreased to a reading of 134 in the fourth quarter of 2021, down from 137 in the third quarter of the year, but above the reading of 124 posted in the fourth quarter of 2020.
Compared with the previous quarter, respondents to Danske Bank’s December 2021 survey reported feeling less confident about their current finances, future finances, job security and their expected spending on expensive items.
Danske Bank said that while annual consumer spending is still expected to rise in 2022 as the recovery from the pandemic continues, high inflation and falling confidence levels could influence the rate of spending growth.
Don’t hold off on home heating oil in hopes of price drops, expert urges Northern Ireland consumers
Blueprints unveiled for enormous new hotel right next to Belfast’s Titanic centre in the city’s old shipyard district bringing over 600 construction jobs
Planning system in Northern Ireland to go down for three weeks as computer crisis looms
Curry’s Fun Park Portrush announce new rides, tokens and appeal for staff
Postal workers set to go on strike across Northern Ireland next month
Asked what had the largest negative impact on their confidence levels, 25% of respondents pointed to the post-Brexit trading arrangements in NI, closely followed by the 24% of people who said that the impact of higher prices on their household finances adversely impacted them (up from 18% in the previous quarter and 12% in the quarter before that). 12% pointed to coronavirus restrictions as having the most negative impact on them.
When asked what had the largest positive impact on their confidence levels, 40% of those surveyed said the rollout of the coronavirus vaccine programme was the biggest factor, with 11% noting the gradual easing of restrictions as a positive influence.
In the latest survey, 25% of people felt their financial position had improved over the previous 12 months, but 28% felt their finances were in a worse position.
Asked about their future finances, 23% of those surveyed expected their financial position to improve over the next year, compared with 26% who believed their finances would deteriorate.
When it came to job security, 14% of people expected to become more secure in their job, while 10% expected their job security to worsen. In terms of spending, 23% of respondents said they expected to spend more on expensive items over the next year, compared with 29% who anticipated spending less.
Commenting on the latest release of the index, Danske Bank chief economist Conor Lambe said: “The rate of inflation in the UK has been on an upward trajectory for a number of months. In January 2021, the CPI inflation rate was just 0.7%. In December, the month that our survey was conducted, the rate of inflation was 5.4% and it increased again to 5.5% in January 2022.
“The rise in inflation has been brought about by a number of factors including higher energy prices and supply chain disruption contributing to an increase in the price of goods. Looking forward, the rate of price rises is expected to move even higher over the coming months. High inflation erodes households’ purchasing power and our survey shows that inflationary pressures are becoming an increasingly negative driver of consumer confidence levels.”
A message from the Editor:
Thank you for reading this story on our website. While I have your attention, I also have an important request to make of you.
In order for us to continue to provide high quality and trusted local news on this free-to-read site, I am asking you to also please purchase a copy of our newspaper whenever you are able to do so.
Our journalists are highly trained and our content is independently regulated by IPSO to some of the most rigorous standards in the world. But being your eyes and ears comes at a price. So we need your support more than ever to buy our newspapers during this crisis.
With the coronavirus lockdown having a major impact on many of our local valued advertisers - and consequently the advertising that we receive - we are more reliant than ever on you helping us to provide you with news and information by buying a copy of our newspaper when you can safely.
You can also enjoy unlimited access to the best news from across Northern Ireland and the UK by subscribing to newsletter.co.uk
With a digital subscription, you can read more than five articles, see fewer ads, enjoy faster load times, and get access to exclusive newsletters and content. Visit https://www.newsletter.co.uk/subscriptions now to sign up.