Irish Consumer Sentiment improved significantly in April with the end of hostilities in Iraq according to the latest IIB/ESRI Consumer Sentiment Index.
The index jumped to 68.4 from 62.8 in March to reach its highest level since September 2002. As in other countries, the removal of fears that war in Iraq could have a major impact on global economic prospects was cited as the key driver of the rise in consumer sentiment.
Commenting on the survey, the ESRI's Mr David Duffy said "Irish consumers appear to have become more positive about the general economic outlook. However, their response to a question on the outlook for the labour market indicates that they remain cautious about job prospects, with a more subdued improvement in this component of the indices."
In addition, the March ECB interest rate cut and together with a drop in oil prices may also improved consumers' assessment of their personal financial situation over the next twelve months.
Mr Austin Hughes, chief economist at IIB Bank, noted: "Clearly, the extent of the rise owes a great deal to relief at the end of the war in Iraq. However, Irish consumer Sentiment has not been as hard hit by war worries as corresponding confidence measures for most other economies. So, this April reading may also hint at an underlying improvement in domestic economic conditions."