Coalition urged to take caution on budget spend

A strong recovery is under way, according to the Central Bank yesterday, as it reiterated a gentle warning to the Government against any potential giveaways in October’s pre-election budget.

Central Bank officials increased their growth outlook for the economy for this year and next year, saying domestic demand — including investment by firms and consumer spending — will play an increasingly important role in driving economic growth in the coming years.

In an upbeat quarterly report, the Central Bank increased its forecast for GDP growth this year to 4.1% from the 3.8% it had predicted in the spring, and projected strong growth of 4.2% through 2016, up from 3.7% previously forecast.