Discretionary spending cash to rise

CASH available for discretionary spending by households with mortgages will increase by 6.5% this year, as a result of ECB interest rate cuts, according to the Irish Business and Employers Confederation.

However, IBEC said, because of “increased uncertainty in Europe and globally”, it has cut its forecast for 2012 GDP growth to 0.9%.

In its first Quarterly Economic Outlook of 2012, IBEC forecasts that, despite the cut in mortgage rates, consumer spending is set to fall by a further 2% in 2012, before recovering by 0.5% in 2013.