Tariff stability lifts Irish consumer confidence
Food price pressures drive further weakening in sentiment towards household finances
Print26 August 2025
Irish consumer confidence improved slightly in August as the US-EU tariff deal reduced uncertainty about the economic outlook.
However, rising grocery prices and back-to-school costs prompted a small further weakening in sentiment around household finances.
Speaking on the recent release of the August data and analysis, David Malone, CEO of the Irish League of Credit Unions noted; “While it is encouraging that consumer sentiment has edged higher in August, the main message of the survey is that elevated living costs remain a key issue for many Irish households.
“Consumers continue to turn to their local credit union for guidance and support as they manage the ups and downs of their personal finances.”
Summary
While the early August agreement on tariffs will weigh on the outlook for economic activity and employment, Irish consumers likely responded in a marginally positive fashion both because the tariff deal should reduce uncertainty, and because the proposed scale of tariffs, while material, falls a good deal short of widely feared worst-case scenarios.
While trade wars have posed a large but still latent threat to the Irish economy in recent months, pressure on living costs has been a painful and persistent difficulty for many Irish consumers.
The August survey period saw a renewed focus on rising prices, with a particular spotlight on a persistently fast rise in grocery prices.
This prompted a further weakening, albeit relatively limited, in those elements of the survey dealing with household finances.
On a more positive note, the August survey saw a small uptick in consumer spending plans that may reflect bargain hunting in summer sales, back-to-school outlays and some fine weather-related outings.
This hints that the overall picture in relation to Irish consumer spending at present is one of a struggle rather than a slump.
Tariff worries
Irish consumer confidence edged up in August, with the Credit Union Sentiment Index rising to 61.1 from July’s 59.1.
Reduced tariff fears outweighed rising living costs, though sentiment remains well below historical averages.
While Irish consumers felt slightly less negative about the economic outlook and jobs, food price inflation, especially for staples like beef, butter, and milk, worsened personal finance concerns.
Global comparisons showed falling confidence in the US and Eurozone but a modest UK rebound.
Overall, Irish sentiment suggests constrained but not collapsing spending, with financial pressures varying widely across households.
Essential spending
Irish consumers report spending more on essentials like groceries and bills, while cutting back on discretionary items and going out, according to the August Credit Union Consumer Sentiment Survey.
Rising prices are the dominant reason for increased spending, especially on food and household costs, with younger and higher-income groups also citing higher earnings and purchases.
Housing costs weigh heaviest on those struggling financially, while older homeowners feel less impact.
Despite government supports, real disposable incomes per capita fell in early 2025, leaving many worse off.
The survey highlights living costs as the key economic concern shaping consumer behaviour.
Read more: Ireland’s Consumer Sentiment Index to continue under Credit Union, Core Research partnership
© 2025, ShelfLife by Ryan Brennan
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