Back in recession after GDP falls

The 0.6% contraction in GDP over the first quarter of 2013, following on from the revised 0.2% shrinkage in the final quarter of last year, puts Ireland officially back in recession.

If the lack of growth in the economy continues for the rest of the year, then it will have serious implications for Ireland’s exit from the EU/IMF programme and October’s budget.

Much of the contraction stemmed from the reduction in net exports as the patent cliff saw a sharp drop in pharmaceutical exports. Investment also fell, while personal expenditure was down 3% compared with the previous quarter.