The collapse in confidence is largely caused by fears about the impact of US president Donald Trump’s trade policies rather than current financial strains, the Credit Union Consumer Sentiment Index for April indicates.
Large numbers of people are struggling financially as items such as groceries continue to soar in price.
The survey conducted to produce the index shows consumers are not seeing any dramatic change in their current circumstances. But there is a strong sense that more difficult times lie ahead, the findings suggest.
Economist Austin Hughes, who oversees the compiling of the index, said uncertainty reigns.
“Exactly how far or how fast Irish economic conditions might weaken in the future remains unclear and subject to rapid and random changes on policy pronouncements from the White House and elsewhere,” he said, adding that this makes it difficult for Irish consumers to assess how much to adjust their behaviour.
“A state of flux, as well as fear, is likely to dominate consumer sentiment and spending in coming months.”
The confidence of consumers is also being impacted by ongoing price rises, with food inflation a particular concern.
The Credit Union Consumer Sentiment Survey, in partnership with Core Research, has an index reading of 58.7 for April.
This is far lower than the 67.5 figure for March.
It is the second successive month of a substantial decline in Irish consumer confidence.
“The April sentiment number reading is the lowest in just over two years, since the March 2023 figure of 53.8,” Mr Hughes said.
“The April sentiment reading of 58.7 is now also materially weaker than the 29-year survey average of 84.1, and also some distance below the 66.6 average of the past five years.”
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Despite the weakening sentiment for consumers,
a special question asked as part of the sentiment survey found most Irish consumers plan to spend on home improvements in the next two years.
About 43pc plan spending money on what is described as “significant refurbishments”, and another 26pc will spend money refreshing their homes.
Those aged under the age of 45 are far more likely to plan significant home-improvement spending in the coming years than those aged over 55.
