Central Bank advises Government to focus on debt reduction in upcoming Budget

Central Bank advises Government to focus on debt reduction in upcoming Budget

The Central Bank is urging the Government to focus on reducing debt levels in the Budget, instead of tax cuts and spending increases.

It has been praised the response of the coalition and the public to the economic crisis and notes that Ireland is now experiencing 'exceptionally strong growth'.

It has revised its projection for economic growth this year from 4.1% to 5.8% and from 4.2% to 4.7% next year.

The Central Bank said the 'maturing' recovery should be protected by focusing policy on reducing debt levels.

The report said: "Focusing policy on reducing remaining vulnerabilities and strengthening resilience is essential to minimise future risks to economic, fiscal and financial stability."

In relation to domestic policy the report stated: "The latest projections are for growth in both to be maintained around current rates.

"On the trade side, both exports and imports are forecast to grow quite strongly again in 2015, driven in large part by developments in the multi-national sector, with growth in both forecast to moderate in 2016."

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