Irish consumer confidence hits 15-year high ahead of election
DUBLIN (Reuters) - Irish consumer sentiment surged to a 15-year high in January, a survey showed on Monday, a boost for government parties pinning their re-election hopes on a strong economic recovery.
Ireland votes on Feb. 26 in what polls suggest will to be a tight contest dominated by debate over how to spend resources freed up as Europe's fastest growing economy recovers.
The KBC Bank Ireland/ESRI Consumer Sentiment Index climbed to 108.6 in January from 103.9 in December, its highest level since February 2001, before Ireland's last economic boom got out of control and led to a devastating crash seven years later.
"The strongest element of the January results was in relation to purchasing intentions," KBC chief economist Austin Hughes said. "For the first time since 2006, slightly more consumers reported an improvement rather than a deterioration in their personal finances over the past year."
Hughes said that while the survey suggested consumers were not blind to worries about the health of the global economy, 62 percent envisage a stronger Irish economy in the next 12 months with only 13 percent expecting weaker conditions.
But this should not be read as implying a surge in Irish households' spending power is underway, he added. Many voters are still feeling the effects of the crisis and years of austerity, something opposition parties have been highlighting.
"The survey details hint why, ahead of the election, promises of tax cuts and/or increased public spending might seem attractive," Hughes said.
"For a significant number of households, the promise of fiscal measures that at least partly reverse the pain of the downturn may be seen as the main source of hope for the future."
(Reporting by Padraic Halpin; Editing by Catherine Evans)
