Investment in Ireland

Ireland - Investment
Statistical noise causes GDP to record largest drop on record in Q4
GDP dropped 5.4% on a seasonally-adjusted quarter-on-quarter basis in the fourth quarter, contrasting the 1.2% expansion logged in the third quarter and marking the worst reading on record. That said, the poor reading was likely driven by statistical noise. Modified final domestic demand, a metric which strips out distortions arising from multinational activity, rose by 1.3% in seasonally-adjusted quarter-on-quarter terms.
The weaker reading was largely driven by an acceleration in imports of goods and services, which grew 22.7% in Q4 (Q3: +4.3% s.a. qoq) due to significant imports of intellectual property by multinational firms. Meanwhile, exports of goods and services growth sped up to 1.3% in Q4 (Q3: +0.6% s.a. qoq).
This said, the quarter’s growth in modified final domestic demand did mark a slowdown from the previous quarter (Q3: +2.3% s.a. qoq). Moreover, private consumption contracted 0.3% in Q4, marking the worst result since Q1 2021 (Q3: +0.3% s.a. qoq). Therefore, it appears that there was some slowdown in underlying economic activity amid the disruption caused by the Omicron Covid-19 variant and related restrictions.
Government spending, meanwhile, bounced back, growing 0.9% in Q4 (Q3: -0.1% s.a. qoq). Meanwhile, fixed investment rebounded hugely, growing 76.5% in Q4, contrasting the 1.0% contraction logged in the prior quarter.
On an annual basis, economic growth slowed markedly to 9.6% in Q4, following the previous period's 11.3% expansion. Q4's reading marked the slowest expansion since Q4 2020.
Looking ahead to Q1 2022, underlying economic activity is likely improving. A recent fall in Covid-19 cases allowed the government to announce the end to most restrictions in January. This should mean an increase in private consumption activity. That said, red-hot inflation is likely to somewhat limit consumers’ abilities to spend, dampening underlying economic momentum.
FocusEconomics panelists project GDP to expand 5.6% in 2022, which is unchanged from last month’s forecast, and 3.9% in 2023.
Ireland - Investment Data
2015 | 2016 | 2017 | 2018 | 2019 | |
---|---|---|---|---|---|
Investment (annual variation in %) | 52.6 | 50.8 | -6.8 | -21.1 | 94.1 |
Ireland Facts
Value | Change | Date | |
---|---|---|---|
Bond Yield | -0.09 | 0.27 % | Jan 01 |
Exchange Rate | 1.12 | 0.65 % | Dec 31 |
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Economic News
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Ireland: Industrial activity records largest year-on-year decrease on record in April
June 9, 2022
Industrial output plunged 9.6% in month-on-month seasonally-adjusted terms in April, which contrasted March's 1.0% increase.
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Consumer confidence came in at 55.5 in May, down from April's 57.7.
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Ireland: Industrial output growth eases in March
May 9, 2022
Industrial output grew 1.7% month-on-month in seasonally-adjusted terms in March (February: +2.6% mom).
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May 5, 2022
The S&P Global Services Purchasing Managers’ Index (PMI) came in at 61.7 in April, down from March's 63.4.
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Ireland: Manufacturing PMI dips slightly in April but remains at near-record level
May 3, 2022
The S&P Global Manufacturing Purchasing Managers' Index (PMI) fell to 59.1 in April from March's 59.4.