Consumers optimistic over future finances, says report
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A day after a number of big name retailers revealed the toll of a tough trading environment, consumer confidence in Northern Ireland took an unexpected turn for the better.
Northern Bank's Consumer Confidence index, which looks at the financial position of local households and their expectations for the year ahead, saw confidence jump by the largest amount in the last three years in the second quarter of the year.
"A combination of factors are thought to have boosted overall confidence," economist Angela McGowan said.
"A number of austerity measures are now already in place and the fact that they are no longer looming on the horizon works to improve the 'expectations' element of the survey.
"In addition, the economic debate in Northern Ireland is now more focused on growing the economy and the negative budget negotiations are now further behind us.
"Finally, households may also have been reassured by the recent labour market data which shows that unemployment has not deteriorated as dramatically as predicted."
Confidence, according to the bank's index, remains low by historical standards at 108, but has been helped off the first quarter's all-time low of 94 by growing optimism that future spending power won't be quite as tight.
Of the 1,000 people surveyed, 13% believed that their household financial position would improve in the year ahead, while 50% believed it would 'remain the same'.
However, there was a significant drop in the proportion of people who believed that their financial position would worsen in the year ahead - down to 32% from 42% in the last survey.
Householders' current financial position relative to one year ago also improved slightly from 7% to 10%.
There was also a fall in the proportion of people who believed their situation had worsened since this time last year - falling from 49% last quarter to 44% this quarter.
But Angela McGowan said further proof was needed to confirm the start of an economic uptrend.
"It is fair to say that the economic downturn has impacted some households much more than others," she said.
"Middle income households and home-owners in particular have been able to off-set rising prices with lower mortgage repayments."