Ireland Economic Forecast

Ireland Economic Outlook

October 27, 2020

Available data for Q3 points to a frail economic scenario, after GDP plummeted at a record-breaking pace in Q2. Following robust expansions in July, industrial output swung to contraction in August and retail sales growth lost some pace in the same month. Moreover, while the manufacturing PMI stagnated in September, the services PMI fell back into negative territory amid falling new business. Turning to Q4, due to a surging number of new virus cases, the authorities imposed a six-week lockdown effective from 22 October, closing all non-essential businesses, bars and restaurants, while also limiting movement, which is set to weigh on activity in the quarter. Meanwhile, on 13 October, the government presented the 2021 budget draft with a spending package of almost EUR 18 billion—the largest in Irish history—aiming to prop up the economy amid the fallout from the health crisis.

Ireland Economic Growth

After a projected contraction this year on the impact from Covid-19, the economy is set to rebound in 2021 as global demand recovers. Fiscal stimulus and liquidity-boosting measures should also support a rebound in domestic activity. A prolonged health crisis and a potential no-deal Brexit cloud the outlook, however. FocusEconomics panelists project GDP to expand 4.3% in 2021, which is down 0.4 percentage points from last month’s forecast, and 3.4% in 2022.

Ireland Economy Data

2015 2016 2017 2018 2019
Population (million)4.74.84.84.95.0
GDP per capita (EUR)55,75656,94561,56966,32070,145
GDP (EUR bn)263272297324347
Economic Growth (GDP, annual variation in %)25.23.78.18.25.6
Domestic Demand (annual variation in %)16.320.6-0.6-8.635.3
Consumption (annual variation in %)3.25.23.03.42.8
Investment (annual variation in %)52.650.8-6.8-21.194.1
Exports (G&S, annual variation in %)39.34.19.210.411.1
Imports (G&S, annual variation in %)33.218.41.1-2.935.6
Industrial Production (annual variation in %)44.32.1-2.5-4.82.9
Retail Sales (annual variation in %)10.87.63.93.72.1
Unemployment Rate9.98.46.75.85.0
Fiscal Balance (% of GDP)-2.0-0.7-0.30.10.4
Public Debt (% of GDP)76.773.867.763.558.8
Inflation Rate (HICP, annual variation in %, eop)0.2-0.20.50.81.1
Inflation Rate (HICP, annual variation in %)0.0-0.20.30.70.9
Inflation (PPI, annual variation in %)7.20.40.8-2.4-5.6
Policy Interest Rate (%)-  -  -  -  -  
Stock Market (annual variation in %)30.0-4.08.0-22.131.1
Exchange Rate (vs USD)-  -  -  -  -  
Exchange Rate (vs USD, aop)-  -  -  -  -  
Current Account (% of GDP)4.4-4.20.510.7-9.5
Current Account Balance (EUR bn)11.6-11.41.534.3-32.8
Trade Balance (EUR billion)42.644.739.948.862.5

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Ireland Facts

Value Change Date
Bond Yield-0.090.27 %Jan 01
Exchange Rate1.120.65 %Dec 31

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