Ireland skyline

Ireland Economic Forecast

Ireland Economic Outlook

GDP shrank 1.8% quarter on quarter in Q3 on weaker multinational activity, marking the third contraction in four quarters. Private spending was also likely soft, as suggested by falls in both the services PMI and monthly retail sales in the quarter. Turning to Q4, our panelists expect the economy to rebound. That said, data for the quarter so far has been downbeat. In October, consumer confidence slipped from Q3, as did the manufacturing and services PMIs. Moreover, in that same month, unemployment rose from Q3. Any rebound in GDP is likely to be driven by the volatile multinational sector, with the underlying economy, in contrast, slowing. In other news, an advisor to the EU’s top court—whose opinion the tribunal tends to follow—said in November that Ireland may be entitled to EUR 13 billion in tax from Apple Inc., potentially boosting government coffers but also buffeting FDI.

Ireland Inflation

Harmonized inflation fell to 3.6% in October from 5.0% in September. Price pressures continue to be pushed up by the soaring cost of electricity, gas and mortgage repayments. However, they should nearly halve in 2024 from their 2023 rate on past rate hikes and a tougher base effect. A key upside risk is a possible spike in energy prices.

This chart displays Economic Growth (GDP, annual variation in %) for Ireland from 2013 to 2022.

Ireland Economic Data

2018 2019 2020 2021 2022
Population (million) 4.9 4.9 5.0 5.0 5.2
GDP (EUR bn) 327 356 375 434 506
GDP per capita (EUR) 67,016 72,006 75,170 86,176 98,022
Economic Growth (Nominal GDP, ann. var. %) 9.7 8.8 5.3 15.7 16.6
Economic Growth (GDP, ann. var. %) 8.5 5.3 6.6 15.1 9.4
Domestic Demand (ann. var. %) -2.3 42.0 -10.7 -16.7 8.3
Private Consumption (ann. var. %) 4.2 2.6 -9.9 8.4 9.4
Government Consumption (ann. var. %) 4.5 6.5 11.6 6.3 3.5
Fixed Investment (ann. var. %) -8.2 100.7 -16.5 -40.4 5.1
Exports (G&S, ann. var. %) 9.8 11.8 11.5 15.1 13.9
Imports (G&S, ann. var. %) 2.5 42.3 -1.7 -7.5 15.9
Industrial Production (ann. var. %) -4.3 6.4 16.5 28.8 17.5
Retail Sales (ann. var. %) 3.7 2.1 -2.5 9.3 -0.8
Disposable Income (ann. var. %) 4.4 6.0 6.9 5.2 7.3
Unemployment (% of active population, aop) 5.8 5.0 5.8 6.2 4.5
Fiscal Balance (% of GDP) 0.1 0.5 -5.0 -1.5 1.7
Public Debt (% of GDP) 62.9 57.1 58.1 54.4 44.4
Inflation (HICP, ann. var. %, eop) 0.8 1.1 -1.0 5.7 8.2
Inflation (HICP, ann. var. %, aop) 0.7 0.9 -0.5 2.4 8.1
Inflation (Core, ann. var. %, aop) 0.5 0.9 -0.4 2.3 7.8
Inflation (WPI, ann. var. %, aop) -2.4 -1.0 -8.7 -5.2 5.1
ECB Refinancing Rate (%, eop) 0.00 0.00 0.00 0.00 2.50
ECB Overnight Deposit Rate (%, eop) -0.40 -0.50 -0.50 -0.50 2.00
3-Month EURIBOR (%, eop) -0.31 -0.38 -0.55 -0.57 2.13
10-Year Bond Yield (%, eop) 0.89 0.11 -0.32 0.25 3.06
Stock Market (var. of ISEQ %) -22.1 31.1 2.7 14.5 -15.8
Exchange Rate (USD per EUR, eop) 1.14 1.12 1.22 1.14 1.07
Exchange Rate (USD per EUR, aop) 1.18 1.12 1.14 1.18 1.05
Current Account Balance (EUR bn) 16.0 -70.8 -24.5 59.5 54.6
Current Account Balance (% of GDP) 4.9 -19.9 -6.5 13.7 10.8
Merchandise Trade Balance (EUR bn) 109 118 143 169 202
Foreign Direct Investment (EUR bn) -10.5 133.1 62.6 -4.3 1.4

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