DUBLIN (Reuters) - Irish consumer sentiment hit a six-month high in January, buoyed by the reduced risk of a disorderly British exit from the European Union, but still sharply lower than it was a year ago, a survey showed on Wednesday.
Ireland has remained the European Union's fastest growing economy during three years of Brexit talks, but consumer confidence faltered when it seemed that its nearest neighbour could leave the bloc without agreeing to a withdrawal deal.
The KBC Bank consumer sentiment index increased to 85.5 in January from 81.4 in December, the third consecutive monthly rise. The index was significantly higher than the seven-year low of 69.5 in October but well below 98.8 a year ago.
"While Brexit-related fears have eased somewhat in recent months, the January reading suggests that consumers remain nervous about the general economic outlook and their own financial prospects," said Austin Hughes, chief economist at KBC Ireland.
The recent uptick "looks to be a relief rally rather than a fundamental rethink of their circumstances by Irish consumers", he said.
All five elements of the index improved in January relative to December, with the largest gain in relation to jobs, the survey showed.
(Reporting by Conor Humphries; Editing by Giles Elgood)