Irish consumer sentiment at highest level since pandemic began

DUBLIN, March 25 (Reuters) - Irish consumer sentiment rose to its highest level since the COVID-19 crisis began on an easing in concerns over the economic outlook that suggested an “emerging light in a still-dark tunnel”, the survey’s authors said on Thursday.

Ireland returned to a strict lockdown in late December, with most shops, building sites and the hospitality sector shut down under a set of measures that are set to be only gradually unwound over the coming months.

Despite that, the KBC Bank consumer sentiment index rose for a second month in a row to 77.1 in March from 70.8 in February, still short of the long term series average around the mid to high 80s but well above last April’s pandemic low of 42.6.

The increase was driven by significant confidence in the capacity of the economy to weather COVID-19 impacts, but caution regarding consumers’ own financial circumstances and spending plans remained, KBC Ireland chief economist Austin Hughes said.

In an additional question, some 23% of consumers envisaged spending record levels of savings built up across the economy, with 9% planning to put them towards a particular future outlay such as home purchase or renovation and 22% keen to set them aside permanently for future emergencies.

Some 35% of consumers questioned said that they did not build up any additional deposits since the pandemic began.

Hughes said this suggested the reopening of the Irish economy “will see consumer spending bounce rather than boom.”

Reporting by Padraic Halpin; Editing by Catherine Evans