Economic outlook 'clouded' by likely deterioration in trade

The ESRI also said one possible impediment to increasing housing output is the funding gap - the actual level of credit available compared to the amount required to meet housing demand

US president Donald Trump is expected to outline tariffs on the EU on April 2 next week. Photo: AP/Jacquelyn Martin

The Irish economy entered 2025 in a robust position but the “likely deterioration” in international trading conditions, triggered by US president Donald Trump implementing tariffs, will see a reduction in domestic economic growth as well as subdue global investment and consumption, the Economic and Social Research Institute (ESRI) has said.

According to the latest quarterly economic commentary, the ESRI said that Ireland’s modified domestic demand (MDD) - the preferred metric to measure the domestic economy - will grow by 3% this year on the basis that no tariffs are put in place on trade between the US and the EU. This is a revision from the 4% growth the ESRI expected at the end of 2024.