There are two ways of reading the encouraging forecasts of rising advertising spending in 2008. Either there is much more underlying confidence in the economy than skittish City bankers, whining high street retailers and hysterical financial journalists would have you believe. Or the boosterish types in the advertising industry really are unhinged from reality.

After a two-year slump, ZenithOptimedia is upgrading its forecasts for ad spend for almost every medium in 2008. To be sure, a recovery in the advertising market is due. And, taken sector by sector, the Zenith analysis is persuasive.

The advertising expenditure in the radio sector, previously forecast to rise by 0.9 year-on-year, is now expected to increase by 1.9 per cent. Newspapers are expected to benefit from printing more full-colour pages, which are popular with advertisers. The growth in ad spend in the newspaper industry, originally expected at 0.6 per cent, is now forecast at 1.1 per cent in 2008.

The other big winner is the cinema. The record box office numbers in July, courtesy of the unrelenting misery that was the English summer and the unstoppable wonder that is Harry Potter, have renewed confidence in the cinema industry. Next year, advertising is expected to increase by 1.8 per cent, having previously been forecast to rise by 1.2 per cent.

Unfortunately for Michael Grade, the executive chairman of ITV, who will set out his strategy today, the one sector where there is no change in outlook is television. This is chiefly because Contract Rights Renewal - an arcane pact between the advertising industry and the leading commercial broadcaster – limits any upside. In his nine months since taking over ITV, Mr Grade has shown himself to be a confident leader of the channel, not to mention a lucky one: his tenure has coincided with the sensation that was Britain’s Got Talent and the slump in enthusiasm for Big Brother. But even if Mr Grade manages to convince the regulator to help him unravel CRR, the effect will not be felt until 2010.

The prospect of an increasingly buoyant advertising market is good news. These days, good news is not to be sniffed at. Banks are passing on the costs of higher borrowing to customers, eating into disposable incomes. Yesterday a clutch of retailers gave warning of difficult months ahead, as growth in consumer credit slows and confidence in the housing market dips. Not for the first time, the news pages seem to be at odds with the ads.

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