Economic glass is half full, but expect more hikes in taxes
The first quarter national accounts figures, which were published by the CSO yesterday, paint at best a mixed picture of the Irish economy. The good news is that the economy, as measured by GDP, grew in the first three months of 2011. The bad news is that using the much more relevant GNP yardstick, which excludes repatriated multinational profits, the Irish economy shrank by a further 1.3pc.
The first-quarter contraction means that the Irish economy, as measured by GNP, has shrunk by a quarter since its 2007 peak. That's not a meat-and-two-veg economic recession, but a fully-fledged 1930s-style recession.
So what solace if any can be drawn from yesterday's figures? Well the first thing to remember is that quarterly GDP and GNP figures are extremely volatile and can be influenced by such once-off factors such as the timing of the repatriation of profits by multinational firms based in Ireland or when Irish companies with overseas operations choose to bring their profits back to this country.