Ireland: Q1 GDP growth revised up strongly in June
Economy soars in Q1: In a second release by the statistical office, GDP growth in Q1 was revised up to 9.7% on a seasonally adjusted quarter-on-quarter basis (preliminary reading: 3.2% s.a. qoq). That’s an improvement from Q4’s 5.0% expansion and marks the best result since Q3 2020.
On an annual basis, economic growth accelerated to 22.2% in Q1, compared to the previous quarter’s 9.2% expansion and marking the strongest result since Q2 2021.
Trump’s tariffs drive export front-loading: The threat of Trump’s tariffs led U.S. firms to repatriate goods from their Irish subsidiaries in Q1. This, in turn, led fixed investment to soar 41.1% in Q1 (Q4 2024: -8.3% s.a. qoq), and exports to surge 9.4% in the same period (Q4 2024: +5.7% s.a. qoq).
In addition, government spending bounced back, growing 0.7% in Q1 (Q4 2024: -0.1% s.a. qoq).
Less positively, private consumption increased 0.6% in the first quarter, which was below the fourth quarter’s 2.3% expansion. Moreover, imports rebounded, growing 8.0% in Q1 (Q4 2024: -2.3% s.a. qoq).
Panelist insight: On the 2025 GDP growth outlook, EIU analysts said:
“Stronger growth will be led by stronger multinational sector activity, a rebound in investment and a low unemployment rate. However, risks are tilted to the downside, as US import tariffs on pharmaceutical products, if introduced, could bring down growth.”