That’s despite weekend reports that the Government’s plan to spread-out the €3.01bn a year cost of bailing out Anglo Irish Bank over decades has been rejected.
“Clearly, the preferred Irish solution that involves replacing the notes with a long-term government bond which is then used as collateral at the ECB is creating a legal problem for the ECB,” said Dermot O’Leary, chief economist at Goodbody in Dublin.
“While we still expect a deal to be announced before the next payment date, 31 March, there are clearly problems in agreeing a deal that does not breach the ECB Treaty,” he said.
On Sunday Transport Minister Leo Varadkar said “difficulties” remain in talks with ECB on refinancing the bailout, though he remains hopeful a solution will be found.
Sentiment towards the Irish economy is improving and investors can bet on an Irish recovery by investing in shares of Bank of Ireland, Danske Bank and RBS - the owner of Ulster Bank, according to the US bank.
In a research note the bank said investor sentiment towards Ireland is improving, house prices are stabilising and banks have a more upbeat view.