The confidence of Irish consumers has weakened this month following a sharp improvement in April.
However, analysts remain confident that the underlying trends for spending are positive.
The latest IIB Bank/ESRI Consumer Sentiment Index shows overall sentiment was 66.5 in May compared to a figure of 68.4 last month. The corresponding figure for May 2002 was 92.4.
Consumers' perception of their current financial situation also dropped in May with a reading of 82.7 compared to April's figure of 85.5.
Some 1,100 people were interviewed for the monthly survey, which combines two sub-indices indicating how people feel about their present situation and how they view prospects for the next 12 months.
Commenting on the results, Mr David Duffy of the ESRI said: "The decline in sentiment reflects concerns about households' financial situation over the next 12 months and a negative perception of the current environment as a time for making major purchases".
Mr Austin Hughes, chief economist of IIB Bank said the May decline was largely a correction following the large increase in April. "We think the underlying trend is stable or modestly positive," he said.