UPDATE 1-Irish consumer morale steadies, political doubts linger

* Consumer sentiment steady but months of uncertainty ahead

* Justice Minister to retire at general election

* Lending to Irish households continues to shrink

* Accenture announces Irish expansion plans, 100 new jobs

(Writes through with minister stepping down, credit data)

By Paul Hoskins

DUBLIN, Nov 30 (BestGrowthStock) – Irish consumer sentiment steadied
in November, easing fears of a collapse, but economists warned
that continued political uncertainty in the coming months could
undermine the population’s already fragile sense of security.

The surprisingly strong survey results, released just days
after a 85 billion euro ($112) billion EU/IMF bailout of
Ireland’s finances and banks, came as Ireland’s Justice Minister
Dermot Ahern and another lawmaker from Prime Minister Brian
Cowen’s Fianna Fail party announced plans to stand down.

Those following the deepening euro zone crisis have turned
their attention to Portugal following Sunday’s rescue deal but
uncertainty hangs over Ireland’s ability to mend its finances
given the fragility of Cowen’s government and a likely early
general election next year. IID:nLDE6AT0ZK]

The KBC Ireland / ESRI Consumer Sentiment Index inched up to
48.4 this month from 48.1 in October. That is well below the
series high of 130.9 set in January 2000 and below a year-ago
figure of 53.6, but comfortably above an all-time low of 39.6
set in July 2008.

KBC Chief Economist Austin Hughes described the results as
surprisingly robust but said it was too early to draw
conclusions about longer-term trends.

“In the light of the EU/IMF intervention that followed the
survey period and the political uncertainty that still persists,
it could be some months before Irish consumers are completely
sure about their fate,” he wrote in a report accompanying
Tuesday’s survey. [ID:nLAG006400]

A general election became unavoidable last week when Cowen’s
junior coalition partners, the Greens, said they would withdraw
from government once the 2011 budget was passed. The budget
itself hangs in the balance, with two independent lawmakers
potentially in a position to determine its fate.


Ahern, a former foreign minister, said he had informed Cowen
he planned to retire in October having been diagnosed with
rheumatoid arthritis and denied his decision was a response to
plans by Gerry Adams, leader of the nationalist Sinn Fein party,
to run for parliament in his constituency.

“In the interests of my family and myself and my health …
obviously my pace of life has to change somewhat,” Ahern told
national broadcaster RTE. “I believe that there will be a
significant ABA vote in County Louth — Anyone-But-Adams —
given the reaction that I have got to his coming into the ring.”

The departure of one of the government’s most experienced
ministers is another blow for Cowen who opinion polls show is
the least popular prime minister in modern Irish history and
whose Fianna Fail party, long the dominant force in Irish
politics, is expected to lose next year’s vote.

Rory O’Hanlon, another Fianna Fail lawmaker who has sat in
the Irish parliament since 1977, also said on Tuesday that he
would not contest the next general election.

With massive government spending cuts looming, Ireland is
increasingly counting on exports by multinationals with
operations in Ireland, such as chipmaker Intel (INTC.O: ), to
inject some life into the economy.

Foreign companies with European headquarters in Ireland such
as Google (GOOG.O: ) will also be relied on to take up some of the
slack in the jobs market.

Technology outsourcing and consulting firm Accenture (ACN.N: )
said on Tuesday it planned to open a research and development
analytics centre in Dublin, creating 100 jobs over the next four
years on top of the 1,300 people it already employs in Ireland.

In a further sign of economic weakness, credit data on
Tuesday showed loans to households fell 4.9 percent in October
from a year ago, with lending for house purchases 1.6 percent
lower. [ID:nDUB003297]

“There is very little good news in these latest banking
figures,” said Allan McQuaid, chief economist at stockbroker
Bloxham. “Until the banking sector crisis is fully resolved and
things improve on the labour market front then the supply/demand
for credit will remain subdued in our view.”

(Editing by Noah Barkin and Patrick Graham)

UPDATE 1-Irish consumer morale steadies, political doubts linger