Ireland Economic Forecast

Ireland Economic Outlook

November 20, 2018

Recent data suggests that the economy lost traction in the third quarter, following a stellar first half of the year. While export growth remained robust in the first two months of the third quarter, retail sales lost some speed indicating a slowdown in private consumption. Early indicators for Q4 signal dimmer prospects for the Irish economy, with an across-the-board downturn in survey-based data. Consumer confidence plummeted to the lowest in nearly two years in October, on fears of a hard Brexit and a wider global slowdown. Moreover, both the manufacturing and service PMIs lost ground in the month. While the UK Cabinet approved a draft agreement on Britain’s exit from the EU on 14 November, a wave of resignations by key cabinet members has once again thrown the terms of the deal into uncertainty, with the Irish border backstop remaining one of the key points of contention.

Ireland Economic Growth

The economy will likely grow at a weaker pace next year, due to an expected moderation in export growth likely owing to a broad-based slowdown in the Eurozone, coupled with lingering Brexit-related uncertainties. Private consumption is also expected to expand at a weaker pace as inflationary pressures increase, while the government is set to cut spending in the 2019 budget in order to strengthen its fiscal metrics. Risks that Brexit will undermine trade with the UK due to higher costs and disruptive delays continues to threaten the outlook. FocusEconomics panelists expect GDP to grow 3.7% in 2019, which is unchanged from last month's forecast, and 3.1% in 2020.

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Ireland Facts

ValueChangeDate
Bond Yield0.620.27 %Dec 11
Exchange Rate1.130.65 %Dec 11
Stock Market5,492-0.39 %Dec 11

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