Consumer sentiment fell four points to 49.5 in July, according to the latest KBC Ireland/ESRI index.
However, the figure is still much higher that the nadir of 39.6 hit in the same month last year.
KBC’s Austin Hughes said the result is surprisingly good given the amount of recent high-profile job losses.
He says July's outcome shows that consumer sentiment and spending is levelling off and may now be considered to be 'bouncing along the bottom'.
Mr Hughes said that the IMF’s grim assessment had a negative effect on the mood, but added that consumers now feel that forecasts are more accurate and they can plan for the difficult years ahead, something they didn’t believe they could do when the economy was in 'freefall' at the turn of the year.
He added that we were suffering because of the 'Anglo Saxon' economic model employed both here and in the US, in which jobs appear less safe than in European countries.
He said the European model may be better suited to the 'hoarding' of jobs through the recession, and this may explain why consumer sentiment improved in Germany and Italy in July.
