Irish households are saving less and expressing growing anxiety over the risk of a global recession, according to new data from the Bank of Ireland. The latest Savings and Investment Index reveals that fears of a global economic downturn have now surpassed concerns about housing, rent, and inflation as the primary worry for consumers.
The findings mark a shift in sentiment, with geopolitical tensions and trade policy uncertainty playing a central role in shaping public perception.
“The increase in concerns about a global recession comes at a time when geopolitics has taken centre stage,” said Kevin Quinn, Chief Investment Strategist at Bank of Ireland. “With tariffs dominating discourse until recently and the Israel-Iran conflict now escalating, it’s no surprise that recession fears have moved to the top of the agenda.”
The index shows a notable drop in the number of people currently saving, as well as those who feel they are saving enough. The decline occurred between April and June, despite a period of relative economic stability in Ireland.
Quinn noted that after a series of eight interest rate cuts by the European Central Bank (ECB), many savers may feel discouraged by the lower returns on offer. “It’s possible that households are responding to geopolitical uncertainty and tariff-related fears by spending more now, anticipating future price rises on imported goods,” he explained.
Concerns about housing and the rising cost of living remain particularly high among younger respondents, consistent with recent trends in the housing market and rental sector.
While saving attitudes have weakened, the report shows that investment activity remains steady. The number of Irish households actively investing has held at elevated levels for the third consecutive quarter. However, confidence is wavering.
For the second quarter in a row, fewer respondents said they believed it was a good time to invest, signalling a more cautious approach despite continued participation in the market.
The overall findings highlight a complex picture for household finances: consumers are wary of global economic threats, uncertain about future interest rates, and grappling with high living costs at home. As global trade dynamics and geopolitical risks continue to evolve, Irish households may remain caught between the urge to prepare for the worst and the desire to make the most of the present.
