Return to recession narrowly avoided

IRELAND avoided slipping back into recession in the third quarter, but its modest growth rates underline the huge challenge ahead in tackling its financial crisis.

Ireland’s debt levels have quadrupled on the back of a banking sector meltdown and it needs solid economic growth to ensure it can meet repayments and fiscal targets set down in an €85 billion EU/IMF bailout.

Gross Domestic Product (GDP) rose 0.5% in the third quarter, rebounding from a 1% drop in the previous quarter but missing expectations for a 0.8% increase as a strong export performance only partially compensated for weak domestic demand.