Sep 10, 2015
Irish economy to grow by around 6 percent in 2015 after strong second quarter
Sep 10, 2015
Ireland's government expects the economy to grow by around 6 percent this year, far more than originally forecast after data on Thursday showed that it grew by 1.9 percent quarter-on-quarter from April to June.
After growing by more than 5 percent in 2014, Ireland's fast recovering economy was already set to be the best performing in Europe for the second successive year when the government forecast in April that it would grow by 4 percent this year.
However, the strong second quarter followed upwardly revised growth of 2.1 percent in the first three months and put gross domestic product (GDP) 6.7 percent ahead of the second quarter a year ago, the Central Statistics Office (CSO) said.
"If you get 7 percent in the first half of the year, if the economy didn't grow at all in the second half, you'd still have 5.7 by year end," Finance Minister Michael Noonan told reporters.
"Of course the economy is growing very strongly in the third quarter so somewhere around 6 (percent), slightly below, slightly above for the 2015 figure."
Ireland's debt to GDP ratio will fall below 100 percent by the end of this year rather than 2016 as initially expected, Noonan said. Ireland's debt peaked at 125 percent of GDP in 2013 as it completed a three-year international aid programme.
Between April and June, exports rose 5.4 percent quarter-on-quarter, the typically volatile investment spending grew 19.2 percent and personal consumption was up 0.4 percent to stand 2.8 percent higher year-on-year following strong retail sales that rose at an even sharper pace in July.
"These GDP growth rates are exceptionally strong. However, they are not inconsistent with the rapid growth of goods exports, industrial production, retail sales, employment and tax revenues through 2015," Davy chief economist Conall Mac Coille said.
"The underlying picture is that the natural bounce back in the economy has been accentuated by the weak euro stimulating exports and low oil prices and tax cuts helping real incomes."
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