On the up

Published Monday, 22 July 2013
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There's nothing like a bit of sunny weather to get everyone's spirits up but that's not why consumer confidence has been on the rise.

The Danske Bank survey which shows a three year high in the feel good factor was conducted in the second quarter which when you think about it wasn't too warm and dry.

No, the explanation for the improvement in mood I suspect has more do to with the housing market stabilising and unemployment peaking.

The number claiming unemployment benefit has been falling by close to 2000 over the past five months. Though you can never be sure about these things, it indicates the worst is over in the jobs market.

The picture with house prices is more confused. NISRA's Residential Property Price Index shows prices are still falling while other surveys indicate modest increases in the cost of buying a home.

But the contradiction is easily resolved. The NISRA survey uniquely includes all sales including hotel based auctions where homes are sold at knock down rates. Strip those bargain basement deals out of the equation and you would probably see a similar picture across all surveys.

While the economy is moving in the right direction the pace of improvement looks glacial and that is reflected in some of the figures from the Danske Bank survey. For example the number of respondents who expected their financial position to improve rose from 12 to 14 per cent, hardly a dramatic surge.

We're getting there but progress will be slow and halting.

© UTV News
Comments Comments
John Joe in Ballymoney wrote (555 days ago):
Surely consumer confidence and spend is directly related to the amount of money in circulation. The amount of money in circulation is directly related to how much banks lend to consumers. Any facts or figures on the source of the issue?
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Jamie Delargy
Jamie Delargy

Jamie Delargy is UTV's Business Editor with a keen eye on local and global economic issues.

A Cambridge Philosophy graduate, Jamie had a brief spell in teaching before launching his career in journalism. In his spare time he enjoys a spot of tennis and is an avid reader.

His favourite saying is "Power corrupts. Absolute power corrupts absolutely."

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