Ireland: Economic growth decelerates in Q3
December 12, 2014
In Q3, the economy increased a meager 0.1% over the previous quarter in seasonally-adjusted terms, which was lower than the 1.1% expansion observed in Q2. The result, which fell short of the 0.3% growth expected by the market, was driven by contracting domestic demand and a deterioration in the external sector.
Domestic demand swung from a 0.3% increase in Q2 to a 0.2% decrease in Q3. Private consumption was flat (Q2: -0.2% quarter-on-quarter), and government consumption dropped to a 0.9% contraction (Q2: +1.1% qoq). Moreover, fixed investment tumbled from an 8.0% increase in Q2 to a 0.8% decline in Q3.
On the external side of the economy, exports decelerated from a 6.3% rise in Q2 to a 2.7% increase in Q3, which marked the weakest growth since Q3 2013. At the same time, imports recorded a 3.5% expansion (Q2: +6.4% qoq). As a result, the external sector’s net contribution to GDP growth swung from plus 1.3 percentage points in Q2 to minus 0.1 percentage points in Q3.
On an annual basis, economic growth decreased from 7.3% in Q2 to 3.5% in Q3.
Author: Carl Kelly, Economist