Goodbody: 'Unwise' to abandon austerity

A new report on the economy says the abandonment of austerity would be premature, despite the current jobs-led recovery.

Goodbody is predicting unemployment will fall below 10% next year, but the stockbrokers firm said Ireland did not have "enough in the tank" to cope with another international shock or a long period of low inflation or deflation in the euro area.

Goodbody expects that strong growth will continue, led by a rebound in business investment and an ongoing recovery in the property market.

The firm believes there is scope to reduce the planned €2bn austerity measures in Budget 2015 by up to €500m, but said it would be unwise to abandon the programme completely.