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IRELAND’S HOPES FOR a recovery in its domestic economy have taken another blow, as a new report finds that uneasy consumers are keeping more and more of their money in savings and aren’t willing to spend.
The monthly Nationwide UK (Ireland)/ESRI Savings Index showed an increase for July, as shoppers opted to keep their money stashed away for fear of a further deterioration in the economic environment.
The ESRI said the increase had been driven by a major jump in the Savings Environment sub-index, as more consumers feel encouraged to keep money aside.
The increase in savings comes despite a 3 per cent drop in the numbers who believe now is a good time to save. 37 per cent of the survey’s respondents said they felt now was a bad time to save.
A third of respondents said they were saving between €51 and €100 per month, up by 5 per cent from the previous survey in June, while the numbers saving €26 to €50 per month was up from 17 per cent to 23 per cent.
Brendan Synnott of Nationwide UK (Ireland) said savings concerns were not age-specific, “as it is being expressed by those over and under fifty years of age. Irish consumers are anticipating more uncertainty to come in the future.
“While Ireland is no longer at the centre of the continuing economic crisis, the bigger European and global dimensions that are now the focus of attention suggest that we are moving even further away from the restoration of consumer confidence and therefore willingness to spend.”
The savings index, which had stood at 98 for June, had been at 128 in May – leading some to hope that consumers were becoming more willing to spend their money and get the economy moving again.
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I cant save or spend what i havent got.
It would be good to know if people are saving for the rainy day or for some specific cost, such as, holidays, weddings, christmas. Maybe the survey could find this out.
When credit is so tight, people have to save up to buy larger items. We should see it as a good thing that people buy what they need rather than impulse buying.
I often find it hilarious to think the government and banks are taking measures to encourage spending, to stimulate the economy, yet during the budget they invariably screw the elderly in some way or another.
It doesn’t exactly inspire a ton of confidence in our personal financial futures when the message is essentially “not only do we not want you to have money now, we don’t really want you to have money later either”.
I say let the TDs and banking officials lead by example in stimulating the economy. Let them empty their bank accounts of their millions first, then we’ll see how it turns out for them come retirement.
if people are saving, then the banks won’t go under because there will actually be money in their reserves! i fail to see how saving is a bad thing.
sounds like an increase in D.I.R.T tax if u ask me. they won’t spend it em so let’s tax it
There’s something bogus in the savings rate. Nearly 500k unemployed. How many of these are saving? Black economy back in town?
I wish I could afford to save!
The savings rate (at least the one published by the Central Bank, I’m not familar with this survey) includes people who are paying down debt, it’s not just cash sitting in bank or credit union accounts. But, yeah, black economy is probably booming too.
have your say