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Irish consumers haven't felt this good for 10 years

The figures from the ESRI and KBC Bank Ireland show consumer sentiment at its highest point for ten years.

Image: Shutterstock/Rrraum

A NEW INDEX has found that Irish consumers haven’t felt this good for 10 years.

Consumer sentiment saw a modest gain in December which resulted in it hitting its highest level for a decade.

While Irish spenders had not yet reported feeling the full impact of the recovery, a broader sense is that things are “moving in the right direction”.

This comes from figures by the KBC Bank Ireland and the ESRI Consumer Sentiment Index, which hit 103.9 last month. The last time it hit this point was January 2006, when it came in at 106.2.

Why do people feel better about spending? 

The two areas that were identified as having provided a particular boost to the economy was a stronger jobs market and increased household spending power.

The report released with the new index figures notes that while there was a 7% growth in the first 9 months of 2015, this wasn’t felt by most consumers.

It was broadly anticipated however that it will continue throughout 2016, with 61% of consumers expecting further strengthening and only 12% fearing deterioration. 

One area where a tangible improvement was seen in 2015 was a change in the jobs market, with unemployment falling below 9% for the first time since December 2008.

‘The buying climate’

Speaking about the results Daniel Foley from the ESRI said: ”The strongest component of the survey this month related to consumer’s perception of the current buying climate. The buying climate strengthened in December indicating that households feel more confident with regard to decisions involving major household purchases.

This contributed to an overall increase in the index of current economic conditions this month.

This follows a separate study by Morgan McKinley that that Irish salaries are expected to rise by 10% this year. 

However, just in case you’re feeling a bit too chipper, this good news can be tempered by a more ominous prediction.

According to economists from the Royal Bank of Scotland, another cataclysmic economic downturn could be just around the corner.

Read: Oculus Rift apologises for its VR headset being pricier than expected

Also: The post-Christmas sales are a ‘mixed bag’ for Irish retailers

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