Ireland doesn’t get much attention, being at the fringe of EMU, but as Greece has currently a number of problems that it shares with other EMU countries, it is warranted to give it a closer look. The KBC Bank/ESRI Consumer Sentiment Index showed a surprisingly strong improvement in January. Consumer sentiment in Ireland rose from 53.3 to 64.6 in January, its highest level in two years and the strongest monthly increase since a similar rise in December 2004. All five components rose, which has only been observed nine times in the 167 months in the history of the series. The improvement was substantially boosted by the strongest gain in the buying climate on record as consumers were encouraged by aggressive price discounting in the winter sales. The outcome points to a further easing in terror that gripped Irish consumers and while consumers are still cautious, they started 2010 on a notably more positive note. The lesson one might draw from the report for other EMU countries like Greece and later on Portugal, Spain or others, is that the population might be ready to accept a harsh austerity package, if it is convinced it might help. It may after an initial period of gloom, give the people again confidence in the future. While it is too early to draw this conclusion, it might also lead to stronger growth and show that austerity measures while initially negative for growth shouldn’t been seen as killing growth prospects and making these measures worth making.