A survey which measures how consumers view the economic outlook recorded an unexpectedly large rise last month.
The consumer sentiment index, compiled by KBC Bank and the Economic and Social Research Institute, climbed to 63.7 in October from 53.3 in September. The latest figure was the highest since July 2010.
The ESRI's Cormac O'Sullivan said the big turnaround had been in the perception of how the economy would perform over the next 12 months. He said consumers were feeling less negative about job prospects and more prepared to make big buys.
KBC Bank economist Austin Hughes described the October improvement as "surprising", as there was quite a lot of bad news during the month. But he said stronger than expected Irish growth figures, hopes for an ECB interest rate cut and perhaps strong sporting performances may have eased the "feelbad" factor among consumers.
The economist warned, however, that the level of the index suggested that consumers were still relatively gloomy, though a little less pessimistic about Irish economic prospects.
The ESRI's Cormac O'Sullivan said the rise in sentiment was broadly-based. The index of current economic conditions rose from 72.3 in September to 82.2, while the index of expectations for the coming months climbed from 40.5 to 51.3.
