Economy to grow faster than China's - Cantor
Published 22/09/2015 | 02:30
The Irish economy will grow faster than China's this year, Cantor Fitzgerald has forecast.
It also said the State was on track to recoup around €29.5bn invested in the three remaining Irish banks - AIB, Bank of Ireland and Permanent TSB.
The global investment banking giant predicted GDP growth this year of 7.2pc, dramatically better than its previous estimate of 4.4pc.
And it also revised up its forecast for 2016 growth from 3.7pc to 4.4pc. China's economy is expected to grow at about 7pc this year.
Cantor's latest sovereign outlook from Ryan McGrath and Fiona Hayes reiterates the widely held view that Ireland looks set to retain the position at the top of the Eurozone growth table for a second year running, with the recovery becoming more entrenched and domestic demand the main driver.
It has also markedly pushed up its projection for consumer spending to 3.5pc.
"This bullish outlook is predicated on a number of factors including healthy employment growth, a resumption of wage rises, and end to austerity, lower energy prices boosting disposable income, persistently low interest rates and strong signals from high frequency indicators such as retail sales, car sales and consumer confidence," the Cantor report said.
It added the budget deficit is expected to come in around 1.5pc this year - a figure also forecast by Finance Minister Michael Noonan - and the debt-to-GDP ratio will fall to 98pc.
Cantor also backed the Government's €1.2bn to €1.5bn Budget expansion plan as prudent.
It said it still believes that a sale of 25pc of the State's stake in AIB will recoup around €3bn for the taxpayer, with higher returns from a patient sell-down path over the following years.