Consumer sentiment rose to its second highest point in eight years last month, according to KBC Bank Ireland and the ESRI.
The organisations’ consumer sentiment index hit 90.5 in December, up more than five points on the previous month.
Austin Hughes, chief economist at KBC Bank Ireland, said the increase reflected consumers’ improved outlook in relation to their own financial situation.
This may be down to a number of factors, including Budget measures, low inflation and signs of jobs growth in the wider economy.
Despite this, a third of consumers expect their financial situation to deteriorate in the year ahead – while less than a quarter predict an improvement.
Overall, Mr Hughes said the survey suggests a gradual return to confidence amongst Irish consumers, though it also shows that many have not yet enjoyed the benefits of any early economic recovery.
This makes any positive momentum in consumer attitudes uneven and fragile, he said.
“This highlights the delicate task facing policymakers in framing the expectations of consumers as to what scale of improvement in their living standards the Irish economy can reasonably deliver in the next couple of years,” Mr Hughes said.
