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Consumer sentiment in March strongest since end of 2011

IRISH consumer sentiment improved marginally in March and posted the strongest reading since October of last year, according to a new report.

The KBC Bank Ireland/ESRI consumer sentiment index increased to 60.6 in March from 57 in February.

While the index suggests the mood of Irish consumers is still fairly downbeat, the March reading is just above the average of the past five years.

Peak to trough readings were 85.7 in May 2007 and 39.6 in July 2008 respectively.

“Irish consumers are not quite as gloomy as they were at the peak of the crisis but they continue to see the major obstacles that preclude a return to solid growth in economic activity and incomes,” said KBC Ireland chief economist Austin Hughes.

He added that the March 2012 index is seen as fairly typical of the “new normal.”

Consumers remain very cautious and are particularly concerned about their personal finances but the extreme fears that prevailed in late 2011 seem to be slowly easing, according to Mr Hughes.

The marginal improvement in Irish consumer sentiment in March was broadly consistent with small gains in comparable US and euro area indicators and somewhat better than the decline seen in the UK last month.