Inflation still a worry for NI consumer confidence

Consumer confidence still lower than it was in 2021

Inflation is still a worry for consumer confidence in Northern Ireland, despite a slight improvement at the end of 2022 according to a Danske Bank report.

The report found that confidence was slightly higher than the third quarter of last year.

But it is well below 2021 levels due to higher prices continuing to put pressure on household budgets.

The survey was carried out in December 2022 with 1,018 people. At that time inflation was 10.5%.

• Why are prices rising so much?

• Northern Ireland economy expected to shrink next year

People who took part in the survey reported feeling more confident about future finances and spending than they did in the third quarter of 2022.

But they felt less confident about current finances and job security.

More than half (58%) thought their finances had deteriorated over the past 12 months, compared to 14% who felt their financial position improved.

About half (51%) expect their finances to worsen over the next year.

'Confidence relatively low'

Danske Bank chief economist Conor Lambe said: "Despite starting to fall towards the end of last year, inflation in the UK remains at elevated levels and is continuing to exert a squeeze on household spending power as well as weigh down on peoples' confidence levels.

"While it was encouraging to see a small rise in consumer confidence in the final quarter of 2022, it should be noted that overall confidence levels remain relatively low.

"As we move through 2023, inflation is expected to continue declining but it will likely take some time for it to return to the 2 percent target. As such, and when combined with relatively low confidence levels, consumer spending is projected to remain under pressure," he added.