Living standards face huge hit this year but no major  economic crisis on cards, says Central Bank

Surging prices are hitting confidence and weighing on consumption and investment growth

For the year as a whole, consumer prices will grow 7.8% and then fall back to the still-elevated average level of 4.2% in 2023, the new forecasts show. File Picture: Reuters/Clodagh Kilcoyne

Irish households face a huge hit to their living standards this year, but the inflation crisis won't spark a major economic crisis, as long as the fallout from the Ukraine doesn't deepen, new Central Bank figures predict.

In its latest quarterly outlook, the Central Bank said consumer price inflation will climb higher than it previously predicted in its April report, and now sees inflation  peaking at a higher-than-expected level of over 10% in the coming months.