Bank of Ireland has today released its latest economic pulse. The pulse is conducted by Ipsos MRBI on behalf of Bank of Ireland with 1,000 households and 1,350 businesses on a range of topics including the economy, their financial situation, spending plans, house price expectations and business activity.
Bank of Ireland say budget day, rising costs and prices, along with emerging doubts over plans to fully lift the remaining public health restrictions made for an uneasy setting this month. And while the headline index was not much changed in October, consumer confidence slipped a bit. Business sentiment held steady, though the picture across the sectors was more nuanced.
Four in five respondents expect house prices to increase over the coming 12 months with factors like excess savings and the extension of the help-to-buy scheme adding to demand. On the supply side, the October survey finds that 74% now think it is a good time to sell a property. This is up from just 25% during the first lockdown and points to a rebound in selling sentiment which bodes well for an uptick in activity in the second-hand market.
Households lowered their assessment of the economic outlook this month and were also more downbeat about their own financial situation. The cost of living was very much on minds, with a further softening in buying sentiment evident in the October data – some 27% considered it a good time to buy big ticket items versus almost a third during the summer – while the share of households expecting consumer prices to increase over the next year rose to a series high of 85%.
This month’s research also considered the ability of businesses to compete in foreign markets. The results show some softening in competitiveness for firms in industry over the past 3 months, which is less to do with exchange rate moves (the euro has been relatively stable against both sterling and the dollar) than with global supply chain disruption and higher costs (three in five are experiencing material and equipment shortages, while four in five have seen an increase in non-labour input costs).
Commenting on the October Economic Pulse, Group Chief Economist for Bank of Ireland, Dr Loretta O’Sullivan said, "The October Economic Pulse presents a mixed picture. Consumers were more hesitant this month, with various worries, not least increases in the cost of living and the rise in virus cases, taking the shine off households’ mood. The business mood remained sanguine on the whole but that’s not to say that everything in the garden is rosy. This month’s research finds that uncertainty is hampering activity in sectors like hospitality and arts and entertainment for example, while firms in industry are grappling with supply bottlenecks and higher input costs, with adverse implications for export competitiveness."
Source: www.businessworld.ie
