Consumer sentiment edges up after budget tax breaks

Consumer sentiment edged higher in October with consumers buoyed by tax breaks announced in the budget.

However, the small lift suggests they remain wary about the uncertain global backdrop.

The latest KBC Bank Ireland/ESRI consumer sentiment index rose to 101.3 in October from 100.6 in September.

The rise followed a 0.5 point drop the previous month.

The report noted that small changes of this sort are not statistically significant and best regarded as indicative of a broadly stable level of confidence through recent months.

The survey was conducted during the first three weeks of October so the results do not reflect an assessment of the measures presented on budget day.

However, the report’s authors said the survey did capture the expectations that developed in relation to Budget 2016.

KBC chief economist Austin Hughes said: "Our sense is that the past few surveys suggest Irish consumers have been trying to weigh up the likely impact of a more uncertain global backdrop of late against the increasing prospect of income boosting measures in the Budget."

“Because the precise nature and extent of recent risks to the world economy remain unclear and the specifics of Budget 2016 were not known through most of the survey period, it is not entirely surprising that the Irish consumer sentiment index did not exhibit a clear trend in October.”