Irish consumer sentiment rebounds in March

Irish consumer sentiment rebounded in March, suggesting that better employment prospects are encouraging consumers to increase their spending even if they remain cautious about the general economic outlook, a survey showed on Thursday.

The improvement reverses a decline in February and continues a see-saw pattern of monthly changes, although a modestly positive trend is still intact.

The KBC Bank Ireland/ESRI consumer sentiment index increased to 108.1 in March from 105.2 in February. In January, the index hit 110.4, which was the highest level since February 2001.

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“The pick-up in sentiment in March represents a continuation of a trend improvement in confidence as Irish consumers put more distance between themselves and the recent financial crisis,” KBC chief economist Austin Hughes said.

“This may be no more than a temporary blip but it could be hinting at the appearance of a ‘feel-good’ factor that could signal a step-up in consumer spending and a more rounded Irish economic recovery through 2018.”

Hughes said the financial crisis is still a significant constraint on confidence but the recent data suggests its impact might be diminishing.

“Irish consumers are increasingly looking forward rather than back,” he added.