IBEC predicts recovery - but higher inflation

Employers group IBEC has predicted an economic recovery but has warned of increased inflation.

After recently rising oil prices, its quarterly report predicted inflation will pick up to 3% by the end of the year.

IBEC Chief Economist David Croughan said the Government must resist the pressure to raise current expenditure.

"I think the fact that they have participated in the wage agreement brought the sort of agreement that we think will keep us more or less in line with our competitors," he said.

"What we think though, is that the exchequer finances are likely to be somewhat better at the end of the year than had been anticipated."