Unemployment may slip below 8% just ahead of the next general election, but the dramatic improvement is likely to stall because the huge numbers on Government activation programmes will likely keep the jobless rate at an elevated level, experts have warned.

Consumer spending volumes grew by over 6% during the first half of 2014 — the fastest rate for seven years — fuelling expectations of a jump of between 1% and 2% for the full year.

There is life in the Irish consumer yet according to the latest CSO retail sales figures which recorded a 7.9% jump in sales volume for the first three months of the year compared with the same period last year.

Consumer spending continued to rise in February (when measured on a year-on-year basis) with retail sales volumes up by 5% compared with the same month last year.

There was further proof of a two-tier housing market yesterday with confirmation that prices in Dublin rose by 15.7% over the last year while prices in rest of the country fell by 0.4% over the same period.

October marked the second consecutive month in which the annual rate of inflation eased, but it is still expected to be only a temporary respite for households as rises in energy and mortgage interest costs are set to push up the inflation rate.

September saw near 1% increases in the volume and value of retail sales, with electronic goods sellers, department stores, and bars benefiting most.

Motorists are set to be hit with a 10c price increase for toll road usage from the beginning of next year, in line with rising inflation.

Lower wages are driving the Irish export market but a continued fall in domestic demand has led analysts to downgrade their forecasts for the economy for this year and the next year.

The ECB decision to make unlimited purchases of three-year bonds for stressed eurozone member states is being hailed as a game changer, although it does not guarantee the euro will survive.

Inflation eased last month, from 2.2% in March to 1.9% in April, but a further drop in prices was offset by rising fuel costs according to the CSO consumer price index.

The latest Greek bailout is a once-off and holds nothing for Ireland in terms of cutting the cost of its debt, junior minister Brian Hayes and EU officials insisted last night.

A SLIGHT drop in consumer prices, particularly mortgage costs and the price of food and clothing, pushed the annual rate of inflation down to 2.5% in December, the first time in four months that inflation slowed.

THE annual rate of inflation crept up to 2.9% in November as consumer prices stayed largely flat during the month.

GERMAN Chancellor Angela Merkel may get some help from the Irish in her push for greater budget unity in the euro region.

CONSUMER prices rose by 0.3% last month, pushing the annual rate of inflation up to 2.8% in October.

BROKERS have called the move by ratings agency Moody’s to cut Ireland’s credit rating to junk as “cynical and manipulative”.

MOODY’S Investors Service says it differentiates significantly between European periphery countries, suggesting it may not imminently cut Ireland’s rating to junk in line with Portugal and Greece.

SOARING insurance, petrol and mortgage costs sent prices up 3.2% in the last year, the highest rate in 30 months.

PRICES have risen the most in three years as consumers were forced to shell out more for food and clothes.