Economic update - June 2021

Irish GDP data for the first quarter of 2021 suggest the economy began this year with exceptionally positive momentum overall but the outsized headline growth number of 7.8% qoq disguises major differences in the conditions faced by different sectors of the economy. Activity in multinational dominated sectors expanded by 17.9% in the quarter whereas domestic-focussed sectors shrank 2.1%. We think that the Irish economy is likely to post strong GDP in 2021 and that this will continue into 2022. We continue to see GDP growth of around 5% this year albeit with significant upside risks to this number

Irish residential property price inflation picked up further in April with the twelve month increase rising to  4.5% (from 3.5% in March ), the fastest pace since January 2019 (+5.2%).  A clear uptrend in Irish property prices is now evident since last autumn when prices were marginally lower than a year earlier. With the economy re-opening and significant fiscal supports still in place, Irish property prices look well underpinned at present. Significantly, constraints on new supply means that while transactions are sharply higher than the ‘lockdown’ affected level of April 2020, they are still below levels seen in 2019. 

Economic forecasts


            2020 2021 2022
Real GDP  (average yearly change, in %) 3.4 5.0 4.0
Inflation (average yearly change, harmonised CPI, in %) -0.5 1.5 2.0
Unemployment rate (Covid-19-adjusted national definition, in % of the labour force, end of year) 21.0 8.0 6.0
Government budget balance (in % of GDP) -5.0 -4.0 -1.0
Gross public debt (in % of GDP) 59.5 61.0 58.0
Current account balance (in % of GDP) 4.6 7.0 12.0
House prices (Eurostat definition, average yearly change in %, existing and new dwellings) 0.3 3.0 2.0

Other forecasts and economic updates



Central and Eastern Europe

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