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Brexit: EU vote shook confidence of Northern Ireland consumers

By Rachel Martin

Published 09/09/2016

Shoppers in the Victoria Square area of Belfast
Shoppers in the Victoria Square area of Belfast

Consumer confidence in Northern Ireland has fallen in the wake of the Brexit vote - but the hit has been smaller than initially forecast.

The latest report from Danske Bank shows that the index fell two points from 139 to 137 during the last quarter.

The bank's latest analysis showed only a marginal decline overall in consumer confidence since the EU referendum.

But when it came to how they felt about their personal finances, consumers said they were significantly less confident compared to the same time last year.

Danske Bank's Consumer Confidence Index surveys 1,000 people on their financial position, job security and expectations for the year ahead.

It asks respondents about four key areas including personal finances, expectations for spending and confidence for the year ahead.

The latest report showed that worries over personal finance marked the biggest change over the quarter.

This aspect of the survey dropped 10 points between the second and third quarters this year.

The fall was driven by an increase in the proportion of people who believed that their finances had deteriorated relative to the year before - rising from 15% to 20%.

However, just under two-thirds of those who were surveyed said that they believed that their personal finances would stay the same over the next 12 months.

Pensioners were the least optimistic, with only 7% of those aged over 65 believing their finances would improve, compared with a third of 25 to 34-year-olds.

The report published today showed Northern Ireland consumer confidence dropped two points after the EU referendum, bringing it down four points over the year as a whole.

It came as spending expectations rose slightly over the quarter, but remained down on the same point last year.

Danske Bank's chief economist Angela McGowan said: "Although we have seen a small decline in consumer confidence in Northern Ireland since the EU referendum, the scale of the contraction is definitely not alarming.

"Very little has actually changed for consumers in Northern Ireland as Brexit has not happened yet. So far the main impact for households has been limited to exchange rates and interest rates.

"That means it is really only consumers who have holidayed abroad this summer that will have noticed the exchange rate difference, while the interest rate change from the Bank of England is very small and will take time to feed through."

Belfast Telegraph

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