Ireland leads way as growth builds

The Irish economy grew 4.8 per cent last year, its best performance since 2007 and the fastest growth in the EU as the country continued to rebound from a debt crisis that forced it to seek an international bailout.

Momentum has continued into 2015 with data released yesterday showing retail sales volumes rose more than 9 per cent year-on-year in March and residential property prices jumped nearly 17 per cent.

The government sees growth remaining above 3 per cent for the next six years with the economy set to expand by 3.8 per cent in 2016.

The solid economic outlook prompted it to cut its forecast for the budget deficit this year to 2.3 per cent of gross domestic product, comfortably below the EU limit of 3 per cent of GDP, and down from a previous estimate of 2.7 per cent. It sees the shortfall narrowing to 1.7 per cent of GDP next year, against a previous estimate of 1.8 per cent.

Unemployment, expected to fall below 10 per cent for the first time in over six years when data for April is released today, is now forecast to drop to 9.6 per cent this year and to 8.8 per cent in 2016 when the government will seek re-election.