GDP growth forecast lowered to 1.3%

The Government has marginally downgraded the GDP growth forecast from 1.5% to 1.3% on the back of a weakening external environment, although there is an improved outlook for the domestic economy with a slight increase in employment.

According to the last set of forecasts issued last December, GDP growth was estimated at 2.5% next year and 2.9% the year after. However, according to the latest Irish stability programme update, growth in 2014 is now seen at 2.4% and 2.8% in 2015.

Last December, the Government had forecast that the budget deficit would be 7.5% at the end of 2013, which would reduce to 5.1% next year and then to 2.9% in 2015 to comply with the troika target of 3%.