Irish consumer sentiment in December suffered its sharpest fall since January after the emergence of the highly transmissible Omicron variant forced the introduction of new restrictions, a survey showed.
The KBC Bank Ireland consumer sentiment index declined to 74.9 in December from 83.1 in November to hit its lowest level since February.
KBC Ireland chief economist Austin Hughes said consumers have been unsettled by the emergence of the Omicron variant and the realisation that the worst of the pandemic might not be behind them.
Public Health Restrictions
He said a surge in inflation, and energy costs in particular, and the impact of new public health restrictions on employment, could also be weighing on sentiment.
Although all five main elements of the KBC Bank consumer sentiment survey weakened in December, Hughes said the best performing elements of the December survey were consumer thinking on how their personal finances would evolve in the next twelve months.
"Resilience in these areas suggests that while Irish consumers may be down, they are not out."
Elsewhere, a survey showed that German consumer morale will deteriorate further at the start of next year, as the COVID-19 pandemic and the rise of the Omicron variant push Europe's largest economy to the brink of a recession during the winter.
Grocery sales in the UK fell 3.8% in the 12 weeks to 28 November, new data from Kantar has shown, however sales compared to the corresponding period two years ago are up 7.0%.