Economic gloom - Downturn needs to be addressed

At the start of the year the Department of Finance expected economic growth to pick up in the second half of the year, but this now seems unlikely. At 1.5%, our anticipated growth rate will be less than half the 3.5% expected. This will have serious fiscal consequences for available funding for next year.

Our inflation rate is not as high as expected, but this decline in the growth of inflation can be attributed largely to the factors which retarded the rest of the economy. The exchange rate of the euro went up by about 8% against the other major currencies, which means that imports from outside the eurozone were cheaper.

At the same time, however, it became more difficult to export outside the eurozone, because items from this country became more expensive. Most of our trade is with countries outside the eurozone and this has had a knock-on effect on employment here.