ESRI offers positive outlook despite rising oil prices hitting GNP growth

SURGING oil prices knocked over 1% off GNP growth this year and will cause some slow down next year as well, the Economic and Social Research Institute (ESRI) warns in its latest quarterly economic commentary.

However, the outlook for this year and next is very positive and the ESRI has revised its GNP forecast up slightly to 6% in GDP terms and to 5.4% GNP. This year the GNP figure would have been 6.4% were it not for the sharp oil spike, it said.

In 2006 the comparative figures will be 5.4% and 5% respectively and they too reflect the knock-on impact of dearer oil, it said. GNP next year would be over 0.6% higher except for the oil shock.