Figures show that consumer sentiment improved slightly in May, but economists said the mood remained cautious.
The IIB/ESRI consumer sentiment index recorded 85.7, up from 83 in May. The ESRI's David Duffy said the improvement came mainly from a more optimistic assessment of future prospects rather than current conditions.
The forward-looking index rose from 72.4 to 77.7 but the index of current conditions dropped from 98.8 in April to 97.7.
IIB economist Austin Hughes said the figures suggested consumers realised that earlier fears of an economic meltdown were exaggerated. He attributed the rise mainly to an easing of fears about the jobs market. But he said the mood remained 'extremely cautious'.
The economist said SSIAs had helped sentiment but the prominence given to lower tax rates in the election campaign also meant people anticipated gains in income. But he warned that failure to make good on these promises could threaten a significant fall in confidence and spending over the rest of the year.
