Overall consumer confidence in Northern Ireland remained unchanged in the first quarter of 2025, as people’s improved confidence around current finances and expected spending on expensive items was offset by lower levels of positivity around future finances and job security, according to new analysis from Danske Bank.
The bank’s quarterly Consumer Confidence Index remained at the same level as in 2024 Q4, at 132 points.
Despite rising wages and lower inflation boosting confidence, the factor having the most widespread impact on people’s sentiment continued to be the lingering impact of higher prices in the economy.
However, over the year to 2025 Q1, overall confidence was up by 10 points. While this reflects continued consumer resilience in the face of a number of challenges, it is worth noting that this was the weakest year-on-year change since the start of 2023.
Overall confidence levels remained around 9% higher than the long-term average in Northern Ireland.
Hannah Martin, Danske Bank Economist said: “Consumer confidence in the first quarter of 2025 remained consistent with how we ended the year in 2024. While there was an improvement in confidence around current finances and expected big ticket spending, this was offset by lower sentiment around job security and future finances.
“Despite inflation averaging a rate reasonably close to target over the year to March, the lingering impact of past price rises continued to be the main factor negatively impacting confidence levels in quarter one. With prices clearly still weighing on people’s minds, we may see confidence being directly impacted by even modest inflationary pressures going forward, perhaps resulting from the wide range of developing global and domestic risks.”
Confidence regarding people’s current financial position improved slightly in 2025 Q1, up one point to a more than three-year high reading of 132.
Confidence related to spending on expensive items also reached a more than three-year high, rising eight points over the quarter to a reading of 127.
However, sentiment regarding people’s expectations around their household financial position over the next 12 months declined by eight points to a reading of 159 and may reflect the growing uncertainties at the time the survey was conducted in March.
There was also a slight decline in confidence around job security in quarter one, with the sub-index falling two points to 110, despite the labour market remaining tight.
Sentiment around savings expectations has been at the same level for the past three quarters.
Hannah Martin said: “The lingering impact of higher prices in the economy was selected by almost four in ten respondents when asked about the factor having the largest negative impact on their confidence levels, increasing from 32% in 2024 Q4.
“Rising wages and lower inflation have reduced some of the pressure on people’s finances, and combined were chosen by just over one in three respondents as having a positive impact on their confidence levels.
“However, the risks to inflation rising again are currently elevated, given business cost pressures arising from the measures contained within the UK autumn Budget, tariff uncertainties and wider global factors. Global risks were chosen by 14% of respondents as negatively impacting their confidence in 2025 Q1. How these factors develop will be key watchpoints for consumer confidence moving forward.”