Economic growth forecasts reduced slightly

Economic growth forecasts reduced slightly

Forecasts for economic growth have been reduced slightly, according to the ESRI.

Its latest report predicts GDP will grow by 4.6% this year - down slightly on the 4.8% previously predicted - because of the slowdown and possibility of Britain leaving the EU.

Unemployment is expected to fall to 7.6% by the end of this year.

It also shows economic growth is being driven more by domestic activity, rather than foreign trade.

Research professor with the ESRI is Kieran McQuinn: “It’s ideal to have balance so you have domestic growth as well as externally generated rates of growth.

“So if you look back to when the economy started to recover initially, it was very much through the external trade channels, we regained our competitiveness, this caused to trade more, to export more.

“And that in turn helped us to start investing in the economy and in turn people to start consuming which is what they have done.”

Meanwhile Ireland's unemployment rate will continue to fall both this year and next.

The latest ESRI report predicts that unemployment will drop to 7.6% by the end of 2016 and to 6.5% by the end of 2017.

Kieran McQuinn is a Research professor with the ESRI.

He says many of the new jobs will be in the construction sector: “That’s under a fairly conservative estimate, as to where we think the housing supply level is going to be.

“Of course if housing supply picks up and if we see a faster rate of supply than we actually expect, then that unemployment rate will actually fall quite significantly, because the construction sector and particularly the residential construction sector is very labour intensive.”

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