Irish economy beginning to feel competitiveness pressures
This week we published new Irish economic forecasts; downgrading projections for both GDP(-1%) and modified domestic demand (2.3%) growth in 2024, but mainly on the back of statistical distortions and volatile data. The bigger picture is that Ireland’s exceptional pace of employment (2.7%) and population (1.9%) growth has continued in H1 2024, ahead of our expectations. Whilst welcome news in many respects, Ireland’s extraordinary economic performance is increasingly evident in bottlenecks, capacity pressures and labour shortages. Hence, in a special box in our new Irish economic outlook document, we highlight pay pressures and house price inflation in Ireland are starting to stand out from other euro area economies. In this context, we also illustrate that build cost inflation, the Covid-19 pandemic and other factors such as planning issues have hindered delivery of the National Development Plan.
Download the document in full here: