Giveaway budget could 'overheat economy' and cause inflation to spike, watchdog warns

Parliamentary Budget Office said Government's failure to adhere to national spending rule risks 'adding more pressure to an overheating economy'

Budget likely to include cost-of-living supports and once-off payments, as well as tax cuts for workers and social welfare increases.

The Government is at risk of “adding more pressure to an overheating economy” with a budget spending splurge, an independent body has warned.

The Parliamentary Budget Office (PBO), based within the Houses of the Oireachtas, highlighted the Government’s failure to adhere to its own spending rules could cause inflation to be almost 2% higher than it would have been if it had followed the rules.