New figures from the Central Statistics Office show that consumer prices fell by 0.6% in March compared to the same time last year on the back of cheaper fuel prices, as well as a fall in the price of some foods.
The CSO said that transport costs in March fell by 4.9% compared to the same time last year mainly due to lower prices for petrol and diesel as well as cars.
Clothing and footwear prices were down 4.1% due to sales, while prices of food and non-alcoholic beverages were down 2.7% due to lower prices across a range of products including bread, cereals and meat.
However, education costs rose by 4.9% due to third level education expenses, while housing costs rose by 1.8% on the back of higher rents and the introduction of water supply charges.
These were partially offset by lower mortgage interest repayments and a fall in the cost of home heating oil.
The CSO said that consumer prices in March rose by 0.6% from February. The main monthly price increases were seen in the transport sector (up 3.4%) and clothing and footwear (up 1.7%).
There were decreases in food and non-alcoholic beverages and health - both down 0.1%.
Commenting on today's figures, Investec Ireland economist Philip O'Sullivan said that the overall decline in consumer prices over the past year, mainly due to factors external to the domestic economy, has provided a lift to Irish consumers.
He added that an increasing number of consumers are also benefiting from the recovery in the labour market and nascent wage growth, while income tax cuts add to the generally positive narrative where households are concerned.
But the economist said that the legacy issue of elevated levels of household debt cannot be overlooked when considering the prospects for Irish consumers.
Meanwhile, Merrion economist Alan McQuaid said that despite the strong recovering economy, domestic inflationary pressures here are likely to remain fairly well contained for some time to come.
With global oil prices still very weak, Ireland's annual inflation rate is set to remain in negative territory in the near-term, the economist said.
"However, we do expect some uptick as the year goes on, with a strengthening labour market and falling unemployment likely prompting a gradual rise in wages, and the depreciating euro pushing up import costs," he added.
Mr McQuaid also said that in his view, Ireland is not on the brink of dangerous deflation, pointing out that the Irish economy is in a lot better shape than the euro zone as a whole.
"Deflation is less likely to take hold in a strong economy, and the Irish economy is healthier at this juncture than the rest of Euroland. All in all, we see lower oil prices as a boost to disposable income and positive for Irish consumers," he added.